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Risk

Negative balance protection — definition & meaning

A safeguard ensuring you can't lose more than your account holds.

Negative balance protection guarantees your account cannot go below zero, so you can never owe the broker more than you deposited, even after a violent market move.

It is required for retail clients in some regions and offered voluntarily by many brokers elsewhere. Without it, a sharp gap on a leveraged position could in theory leave you with a debt.

The information on Trding.io is for general information only and is not investment advice. Trading involves a real risk of losing money, and most retail traders lose. Never trade money you cannot afford to lose.

Related terms

Margin call
A broker warning that your equity is too low to support open trades.
Leverage
Borrowed exposure that lets you control a large position with a small deposit.
Regulation
Oversight of brokers by financial authorities to protect clients.
Segregated funds
Client money kept separate from the broker's own operating money.
Margin
The deposit a broker holds to keep a leveraged position open.
Free margin
The money in your account still available to open new trades.

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