What Is a ‘Margin Call’ and When Is It Issued?
A margin call is a demand from a broker or exchange for a trader to deposit additional funds or collateral into their margin account. It is issued when the equity in the trader's account falls below the required maintenance margin level.
This drop typically occurs when the market price moves unfavorably against the trader's leveraged position, causing losses that erode the initial margin. The call must be met to avoid forced liquidation of the position.
