Understanding TradFi liquidation (stop out)

Liquidation (also known as a stop out) is a key concept that traders should pay close attention to. When you trade on Bitget's MT5 service, liquidation may be triggered if your account margin falls below the required threshold.

Liquidation, or stop out, occurs when the available margin in a trader's account is insufficient to maintain open positions. Specifically, liquidation is triggered when account equity drops below the margin requirement set by the platform. This happens when there are significant market price movements against the trader's positions.

Bitget has implemented the stop-out process for two main reasons. First, to protect traders by preventing even greater losses and ensuring account balances are not completely wiped out. Second, to prevent excessive risk exposure for Bitget as the broker, and to help maintain the overall stability and security of the trading system. Once liquidation is triggered, the platform will automatically close one or more of the trader's positions until the account's margin once again meets the required level.

In the Bitget app, if you're using TradFi (MT5), your margin level can be found under the Trade tab at the bottom of the screen. Tap this tab to view your margin information and stay up to date on your account's margin status.

In Bitget's TradFi (MT5) service, stop out is triggered when account equity falls below a fixed percentage of the required margin. This percentage is called the stop-out level. If equity drops below this level, the platform will automatically close open positions to prevent further losses and ensure sufficient margin is maintained.

For Bitget's TradFi (MT5) service, the stop-out level is set at 50%. This means that when the margin level in your MT5 account falls to 50% or lower, liquidation will be triggered immediately.

Reminder: In Bitget's MT5 service, factors such as mark price or liquidation price are not considered during liquidation.

When stop-out is triggered on the MT5 platform, the corresponding records will appear in the History tab. You can review the details of the liquidation by checking this tab.

For more detailed information, the following data will be displayed:

When a trader holds multiple open positions on Bitget MT5 and the margin level falls to 50% or below, the system will initiate liquidation based on the "Largest Loss First" principle. Specifically, the position with the largest loss will be closed first at the current market buy or sell price, followed by the position with the second-largest loss, and so on, until the margin level rises above the required minimum. This mechanism is designed to protect traders by reducing the risk of unmanageable losses from consecutive losing positions.