Negative balance on trading accounts
Forex and CFDs are leveraged products. They may not be a suitable investment for you as they carry a high degree of risk to your capital and you can lose more than your initial deposits. Therefore, your trading account might enter into negative balance.
Darwinex does NOT offer negative balance protection. We try to prevent negative balance by warning of shortage of funds from a margin level of 100% and closing trades automatically from a margin level of 50% starting with the trade which is losing the most.
Can investors in DARWINs enter into negative balance?
When there is an unknown event, e.g. the flash-crash of the pound on October 7th, 2016, investors could also enter into negative with their investments in DARWINs. Investors can protect themselves from this by diversifying their portfolio. We incentivize diversification by paying diversification rebates to investors.