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AvaProtect Explained: How AvaTrade's Loss Protection Works and What It Costs
AvaProtect lets you pay a premium to protect a forex, gold or silver trade against losses for a set period, from 1 hour to 2 days. If the trade is losing when protection ends, or you close it at a loss, AvaTrade refunds the loss. Here is how it works, what it costs and its limits.
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AvaProtect is a risk tool unique to AvaTrade. You pay a fee when you open a trade, choose a protection period, and if the trade loses money during that period, AvaTrade reimburses the loss. Its Help Center describes it as protection against losses on a specific position for a chosen time frame, in exchange for a fee paid at the time of purchase. AvaTrade says it covers losses of up to $1 million.
It works like buying insurance on a single trade, and like insurance, it is worth it only when the premium makes sense for the risk.
| Instruments | Forex, gold and silver |
|---|---|
| Platforms | AvaTrade app and WebTrader (not MT4) |
| Periods | 1 day and 2 days; 1, 3, 6, 12 hours on some pairs |
| Expiry | 10:00 New York time |
| Premium | Based on expected volatility |
| Cover | Losses up to $1 million |
How AvaProtect pays out
| What happens | Result |
|---|---|
| You close the trade at a loss during protection | AvaTrade reimburses the realised loss |
| The trade is losing when protection expires | AvaTrade credits the unrealised loss; the trade stays open |
| The trade is in profit at expiry | Protection expires with no value; you keep the profit |
| The trade is stopped out during protection | The loss is reimbursed and cover ends |
| You partially close the trade | The remainder keeps its protection |
Credits are applied straight after either event. If the trade is still open at expiry, it carries on unprotected from that point, with any further losses your own.
What it costs
The premium depends on the expected volatility of the instrument over the protection period, and on the trade size and period you choose. It is deducted from your account's free cash when you buy the protection. You can see the available periods and cost on the trade screen in the AvaTrade app before you confirm.
The premium is a sunk cost. If the trade wins, you have paid for protection you didn't need; if it loses, the refund excludes the premium itself.
What AvaProtect doesn't cover
- Overnight interest, commissions or other fees; AvaTrade doesn't refund them.
- The premium you paid.
- Losses after the protection period ends.
- Instruments other than forex, gold and silver.
- Trades on MT4; AvaProtect is available only in the AvaTrade app and WebTrader.
Protection periods
AvaTrade always offers one-day and two-day protection, expiring at 10:00 New York time. For some currency pairs, it also offers 1, 3, 6 and 12-hour periods; tick the AvaProtect box on the trade page to see what is available.
How to use it
- Open the AvaTrade app or WebTrader and choose a forex pair, gold or silver.
- Set the trade size and direction.
- Tick AvaProtect and pick a protection period.
- Check the premium shown, then confirm the trade.
- Manage the trade as normal; you can still set stop loss and take profit, hedge or partially close.
When it can make sense
- Holding a position through a major news release where a gap is possible.
- A trade you are confident in but where a stop would likely be hit by noise.
- Learning with real money while capping the downside of individual trades.
When the premium is high relative to your expected gain, a smaller position with a normal stop loss is usually cheaper.
AvaProtect vs a stop loss
| AvaProtect | Stop loss | |
|---|---|---|
| Cost | Premium paid upfront | Free |
| Slippage risk | Loss refunded during cover | Can slip in fast markets |
| Time limit | Only during the chosen period | Until you remove it |
| Keeps trade open after a dip | Yes | No, it closes the trade |
Many traders use both: a stop for the long term and AvaProtect over a risky event. Our AvaTrade stop out guide explains margin management alongside it.
A worked example
The figures below are hypothetical, because AvaTrade prices each premium live. Suppose the app quotes $15 for one-day protection on 0.5 lot of EUR/USD.
| Outcome | Trade result | AvaProtect | Net result |
|---|---|---|---|
| Losing at expiry | -$120 unrealised | $120 credited | -$15 (the premium) |
| Closed at a loss during cover | -$60 realised | $60 refunded | -$15 |
| In profit at expiry | +$80 | Expires with no value | +$65 |
The premium is the most you lose during the protection period, whatever the market does. Its cost is that every winning trade earns a little less.
Hedging and protected trades
AvaTrade allows you to hedge a position that is under AvaProtect, and to set stop loss and take profit levels as normal. Each AvaProtect contract belongs to one specific position and can't be moved to another trade. If you close the trade, the cover ends at that point.
Questions to ask before buying protection
- Is the premium smaller than the loss I'd take with a sensible stop?
- Does the protection period cover the event I'm worried about, such as a data release?
- Will I still want the trade after protection ends?
- Am I sizing the trade bigger only because it is protected?
Protection can tempt traders into larger positions. Once the period ends, the full trade is exposed again.
Where AvaProtect fits in a risk plan
AvaProtect is best treated as an occasional tool rather than a habit. A normal stop loss costs nothing and works on every trade; AvaProtect costs a premium each time but refunds the loss in full during the cover, including gaps that would make a stop slip. Many traders keep stops as their default and add AvaProtect only for specific events, such as a central bank decision, where a gap is a real risk and the trade is worth holding through it.
AvaProtect is genuinely different from anything most brokers offer, but it is a paid product. Compare the premium with the loss you'd take from a sensible stop; if the premium is bigger, the stop is the better protection.
Ravi wanted to hold 0.5 lot of USD/JPY through a central bank decision. He added one-day AvaProtect in the AvaTrade app and paid the premium shown. The pair dropped after the announcement, and when protection expired at 10:00 New York time, AvaTrade credited his unrealised loss while the trade stayed open.
Frequently asked
What is AvaProtect?
An AvaTrade tool that protects a specific trade against losses for a chosen period in exchange for a premium paid when you buy it.
Which instruments can I protect with AvaProtect?
Forex pairs, gold and silver.
Can I use AvaProtect on MT4?
No. AvaProtect is available in the AvaTrade app and WebTrader, not MT4.
How much does AvaProtect cost?
The premium depends on the instrument's expected volatility, the trade size and the period. It is shown before you confirm and deducted from free cash.
What happens when AvaProtect expires?
If the trade is losing, AvaTrade credits the unrealised loss and the trade stays open; if it is in profit, the protection expires with no value.
Does AvaProtect cover swaps?
No. It doesn't refund overnight interest, commissions or other fees.
Can I close part of a protected trade?
Yes. The remaining part of the trade keeps its protection.
Can I lose more than the AvaProtect premium?
Not during the protection period. AvaTrade credits realised losses in full, even if they are larger than the premium.
Can I move AvaProtect to another trade?
No. Each AvaProtect contract relates to one specific position and isn't transferable.
When is the AvaProtect refund credited?
Straight after you realise a loss on a covered position, or when protection expires with the trade showing an unrealised loss.
Is AvaProtect available on crypto?
No. AvaProtect covers forex, gold and silver trades only.
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