A question about trading on margin in forex? -

Ok, I have one simple question about forex trading on margin... If I deposit $1000 to say....and I lose it and my leverage falls from 50,000 to 40,000..does this mean that I will owe 10 000 to the broker? :) Or I cannot lose more money than the money I have deposited...meaning in the particular case-1000? Thanks alot! Hi, In Margin trading the only amount at risk is the amount you have invested , there is no leverage in your risk because leverage is only for trading in your forex account . The forex firm you will be trading with will keep an eye on your positions, they will inform you about your account status if it is in a critical condition , which in technical terms mean informing the Margin Call. Sometimes it happens that due to market volatility your margin trading account might go into negative and in this case it mainly depends on whose fault it is(this situation is rare is the account is monitored properly by the forex firm you are trading with) For any further query please feel free to contact me at ttabrezs@yahoo.com Sayed R. Tabrez Century Financial Brokers (Dubai) I found some good info here. Believe me, If your account drops below your margin requirement, usually 1/2 your account equity, your broker will issue you a margin call and your position will be closed automatically. Remember not to overtrade and this will not be a problem. (ie. do not open a lot size larger than 5% of your account balance.) You wont gain as much money but you wont get margin called either unless you get stuck on the wrong side of a hyper trend. I allow my account to float (some open losing positions)sometimes if I picked the wrong entry point but only if I am on the positive side of the daily interest. Then when the price has finished going the wrong direction I open another trade in the same direction and ride it back up. This gives me an overall lower blended price and shortens the time back to profitability. (not to mention I get to enjoy the daily interest). NOTE: I dont recommend this for really small accounts. Remember the 5% Rule--some would even argue 2%. The market ranges most of the time so it always comes back around to positive within a week or at the most extreme two weeks. The key as I stated before is not to buy too large of a lot size. It also helps to turn down your margin leverage if you are planning to do a longer term carry trade.