What Is a “Margin Call” and What Triggers It?
A margin call is a demand from a broker or exchange for a trader to deposit additional funds into their margin account to bring the account equity back up to the initial margin level. It is triggered when the account's equity, which fluctuates with the daily marking-to-market of the futures contract, falls below the maintenance margin level.
Failure to meet the margin call can result in the forced liquidation of the trader's position to cover potential losses.
