Can you lose more than you invest?
It depends entirely on your broker.
Some have "negative balance protection".
Some have guaranteed stops.
Some have chosen to forgive negative balance.
Some don't.
You should speak to your broker to clarify their policy.
Also Google "negative balance black swan" which will explain how you can lose more than your deposit using a real-world example.
If your broker doesn't offer 'Negative Balance Protection' as honest_knave very well pointed out above and an 'extinction level event' occurs (like Swiss franc, or Brexit), then stop loss or margin call cannot be applied and you can end up with a negative balance account.
In such a case you are responsible against your broker for this negative balance.
After Swiss Frank happen mostly brokers avoiding to give negative balance protection
That's correct Waseem.
- Free trading apps
- Over 8,000 signals for copying
- Economic news for exploring financial markets
You agree to website policy and terms of use
Hi everyone,
Simple question, and I hope a simple answer: can you lose more than you invest?
If I open an account and deposit $1.000, is there any way *at all* that I can lose more than that $1.000 ? If so, how?
Any insight is appreciated.