Stop out (liquidation of loosing open positions) occurs when the Equity on your account reaches the barrier 50% of the margin requirements.
For example: A client with 2000$ in the account uses 1000 USD to keep a position of 1 lot (100,000) reflects a margin requirement of 1% or 1:100. When the account equity reaches 500$ the position will automatically be closed out by the system.
Note! That different system operates in different ways.
In G-Pro By ACT Forex, all positions will be closed out at once when stop out level hit.
In MetaTrader 4.0 the system closes the position with the biggest loss, and then when stop out level hit again the second biggest loss position will be closed out etc…