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What is mean by Leverage in trading?


kiranchandra

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But that would help you, can you imagine that you trade with such a big amount of money and without leverage? You must spend more of your money. The risk is very directly proportional to the possibility of what will you get in the next trading.

 

 I can not imagine it. Although we only use 0.01 lot for trading, we need huge amount as margin, exclude free margin to hold our position. So although i only get 1:500 from TenkoFx, it's very helpful to start trading with smaller amount than we don't get leverage in forex.

 

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Leverage in foreign exchange trading is a sum of money actually that we borrow from the broker to leverage our position. With leverage you can afford those lots with smaller sacrifice, for example 1 lot size with 1:200 means you need to spend $2000 see, it is more effective for traders and cost efficient.

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Leverage in foreign exchange trading is a sum of money actually that we borrow from the broker to leverage our position. With leverage you can afford those lots with smaller sacrifice, for example 1 lot size with 1:200 means you need to spend $2000 see, it is more effective for traders and cost efficient.

Leverage which we are using for trading, must be maximized wisely. We need to use small amount first if we are new in forex even, it's recommended to use demo account to start trading and learn hwo to maximize leverage

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Leverage which we are using for trading, must be maximized wisely. We need to use small amount first if we are new in forex even, it's recommended to use demo account to start trading and learn hwo to maximize leverage

 

we must maximize the leverage of the broker either because doing so will allow us to trade with the maximum. By then we will be able to leverage trade using little capital, forex is a business that has a high risk, to get the maximum results then we should use leverage with either

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Leverage in trading? Well that is what we are going to use in our trading isn't it? Leverage in fact helping traders to trade i see that many people can trade like what they can trade today because of leverage. Leverage helps trader a lot and not just a cosmetic or foul thing in foreign exchange.

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very meaningful leverage for traders because of the leverage it will allow us to trade with small capital. This is certainly very profitable for traders, and therefore very important leverage. If no leverage then we need a large capital for trading. but be careful when trading with leverage. high leverage if you can not manage it well then we will suffer losses

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@jimjones: I also agree with you 1:100 up to 1:500 is the good range for traders who want to trade, if you already have bigger capital maybe around million dollars, then using 1:100 is the best option to prevent overleraging with your bigger amount of capital.

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Leverage is expressed as a ratio and is based on the margin requirements required on your account.  For example, if your trading account conditions stipulate 2% margin required to trade, this means that to trade the lot size of $100 000 you must have 2% of this amount ($2 000) funded on your trading account.  This corresponds to a 500:1 leverage, as $ 100 000 / $ 2 000 = 500:1. Now i am using this leverage in my trading at TICKMILL
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  • 6 months later...
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for beginners do not be tempted to use leverage because leverage can mempenagruhi our trading. the higher the leverage that we use the higher the risk. So that those who have not enough experience would be better if we could use a little leverage. for the moment I prefer to trade in instaforex with leverage 1:1000
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  • 4 weeks later...

 I can not imagine it. Although we only use 0.01 lot for trading, we need huge amount as margin, exclude free margin to hold our position. So although i only get 1:500 from TenkoFx, it's very helpful to start trading with smaller amount than we don't get leverage in forex.

 

TenkoFX investment forum for PAMM account investors

0.01 is equal to 1000 lot which means $1000, that is already too high for small traders who invest with hundred of dollars. If you have million dollars 0.01 is the best for you not 0.1 or even 1. But thanks to leverage, we can do more with leverage at least 1:100 we need less than $1000 to afford 0.01 lot.

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Leverage is a ratio between trader's own capital and borrowed capital from the broker. Leverage at 1:100 means for each transaction in your account you must have capital 100 times lower than the real transaction, so 1 lot = 100000 means you must have at least 1000 unit in your account to open a position.

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  • 2 months later...

let's say if we choose to trade using a leverage of 1: 1000 then it means we can trade in a 1000-fold of our capital. More and more of our trading capital required margin will be smaller, of course it is very profitable for traders

Pretty much like that. Because we're having some funds that doesn't meet the requirement for the actual forex trading. So that's why we're using leverage in our trading activities...

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@gaban: Yes, this is why forex become one of the most useful things ever existed and also the reason why leverage become an important factor to attract people to join foreign exchange. Can you imagine without leverage what will happen to forex trader who wants to trade?

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I cannot imagine something like that sidejob, everything should be really bad for traders if something like that happened. In order to trade we need big amount of capital, it just make foreign exchange as the business which has high barrier and i'm sure fx won't be so much popular just like it is now.

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Pretty much like that. Because we're having some funds that doesn't meet the requirement for the actual forex trading. So that's why we're using leverage in our trading activities...

 

to leverage the trading with small capital will really benefit us, therefore, to trade better if we could choose to trade using high leverage especially if our capital is small then trading with high leverage is really very favorable

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Leverage is the margine collatral and loan set for a trader to improve his or her trade and value the percentage of that trade in a practical format now for you to trade well using leverage then this need to be borrow during or after your account opening process as it bring up your margine to the specific requirement

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leverage in forex trading should we choose well. By using the leverage that is really beneficial for us then we will be able to manage capital well to benefit us all. for that, I prefer to trade with a leverage of 1: 1000. if we can be consistent with MM and RM are good, it will leave a profit for us

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