The four steps that give you the liquidation price
Most writing about stop-outs explains what it is and stops. The practical question is different: at exactly what price does my account close? It has a numerical answer, computable before entry rather than after:
- Margin held = (lots × contract size × price) ÷ leverage
- Equity at the threshold = margin × stop-out ratio
- Loss required = balance − that equity
- Price distance = loss ÷ value per point
On the reference account: margin is $48, a 50% threshold needs $24 of equity, so the loss is $976, and at $10 per dollar of price the distance is 97.60 — liquidation at 2,302.40. See stop-out and margin level.
The mistake this tool catches and others do not
When the stop loss you set sits beyond the liquidation price, the broker closes your position before price reaches your stop. The protection you believe you have does not exist, and your actual loss is decided by the broker threshold rather than by your plan.
On the reference account liquidation is at 2,302.40, so any stop beyond it — one at 2,300, say — falls outside the distance and never triggers. The tool detects this automatically and ranks it critical, because it voids risk control silently. The fix is not a tighter stop but a smaller size, via the position size calculator.
Why size decides survival, not leverage
The grid in the tool shows the remaining room for each combination of leverage and size on the same account, and the result inverts the common belief:
- 0.01 lots: room of about $988–999 depending on leverage.
- 1.00 lots: room collapses to $2–9.
Across the leverage columns the number moves modestly; down the size rows it collapses by orders of magnitude. Leverage sets the margin held; what you lose is set by size — see leverage and margin.