Negative Balance Protection Definition

Negative balance protection is a broker policy ensuring a client's account cannot fall below zero, even during extreme market volatility.

What is Negative Balance Protection?

It limits a trader's losses to the funds deposited in their account, rather than exposing them to additional debt.

This protection is commonly offered by regulated brokers as a client safeguard.

If extreme volatility would otherwise push an account balance to -$500, negative balance protection resets it to zero.

Net asset value is the total value of a fund's assets minus its liabilities, often expressed on a per-share basis.

Net income is a company's total profit after all expenses, taxes, and costs have been deducted from revenue.

News trading is a strategy that involves entering or exiting positions based on the release of economic data or news events.