If losses run past the money posted, the venue itself ends up covering the gap, so it closes the position automatically before that happens. There is no step where a person checks and decides, so a price that is briefly wrong is acted on all the same. When the price comes back, the closed position does not.
Watch 2
Predictions & track record (2)
Awaiting gradingWhy did a single SK hynix share printing at the daily floor close out 960 accounts?Score by the end of August: if trade.xyz changes its price calculation from a single venue's fill to a blend of venues or a time average as it said it would, this counts as one operator's setting, and if the method is unchanged it counts as a structural feature of such markets.
Awaiting gradingWhy did the Kospi fall another 8% on the day JPMorgan said the forced selling was nearly done?KOSPI jumped a record 17.91% on 7/31, but foreign and institutional selling resumed on 8/3, sending Samsung/SK hynix down another 7-8% and KOSPI down ~3.6%. The reversal within days makes it too early to tell whether this is the tail of the liquidation or fresh selling. Score after another 1-2 weeks once the swings settle.