What is Negative Balance Protection and Why is it Important?

Negative balance protection is a security mechanism offered by some brokers that prevents a trading account balance from falling below zero. In other words, it ensures that, regardless of market conditions or accumulated losses, the user will never lose more money than they have deposited in their account.

Before trading in financial markets, it is essential to check whether the broker offers negative balance protection in the country where you intend to trade. This measure guarantees that, under no circumstances, will the user lose more money than they have deposited in their account.

How Can a Trading Account Turn Negative?

There are various circumstances in which a trading account balance could become negative. This can happen due to:

• Swap charges: Overnight costs for keeping open positions can accumulate.
• Use of high leverage: If losses exceed the invested capital, the account may end up with a negative balance.
• Market gaps: Sudden and unexpected changes in asset prices can prevent stop-loss orders from being executed, if any exist. These situations can arise in times of high volatility or following significant events (e.g., government announcements, economic crises, or geopolitical events).

Do All Brokers Offer Negative Balance Protection?

While most regulated brokers offer negative balance protection, some only provide it for specific markets or in accordance with the applicable regulations in each country. Therefore, it is advisable to check with each broker whether this protection applies to the market in which you wish to trade.

Some Brokers Offering Negative Balance Protection in Certain Markets as of February 2025:

Broker	Minimum Deposit	Regulation	Start Trading
	50 USD	FCA, CySEC, ASIC	Open an account here *eToro is a multi-asset investment platform. The value of your investments may rise or fall. Your capital is at risk.
	100 USD	Seychelles Financial Services Authority (Licence No. SD039) or FSA (Licence No. SD039);	Open an account here CFD service, your capital is at risk
	5 USD	FCA, ASIC, FMA, DFSA.	Open an account here
	100 USD	ASIC, Cysec, FCA.	Open an account here

Disclaimer: BrokerSuperMarket does not provide financial advice or guarantee investment results. It is recommended to check with each broker for the availability of negative balance protection and review the applicable regulations in your country.