If the firm holding your deposit collapses

[FXS London Scalper]

Brokers regulated in the EU are typically members of an investor compensation scheme that covers clients up to a certain amount if the firm fails and cannot return client money. The amount and the conditions vary by country.

Understanding the basics helps when choosing a broker: client funds should be held in segregated accounts, separate from the firm's own money. If that segregation works as intended, a failure should not affect client balances. The compensation scheme is a backstop for when it does not.

A practical step is to check the regulator's register for the specific entity you are opening an account with, since many broker brands run multiple licensed companies under different regulators with different protections.

The scheme typically does not cover trading losses, only failure of the firm to return money owed.

Some traders spread larger balances across more than one broker to limit exposure to a single firm.

Have you checked which entity your account is actually held with?