Trading Discussion Is high leverage is good?

[Razor1911]

As a forex trader, many people ask the same question about leverage. Which leverage should be better for trading? The question may sounds very simple, but to answer it is very difficult for anyone.

What is leverage in forex? Leverage is a tool by which you can hold higher positions when having low margin. So if you have $100 in your account, and having leverage 1:1000, you can hold an amount of 100 x 1000= 100000.

Having higher leverage does not mean that it will earn yo u more. Rather it is very risky to take high leverage. When you will take higher margin, even for small fluctuations of the market your floating profit and loss will fluctuate more. In that way you can get margin call in your account. That is why it is always advisable to use Low or medium leverage. Having small amount you can go with 1:200, and if your amount is greater than 1000 dollars, you can have 1:50 leverage.

 

[Sotherefore]

Using of high leverage is very risky because there is higher possibility of your accounts to be liquidated,when I have been trading of cryptocurrency the highest leverages I will use is x 5, because I cannot use higher than that but I've seen people that have been using x 50, it depends on a person's capital.

 

[Wisdom01]

Using of high leverage is very risky because there is higher possibility of your accounts to be liquidated,when I have been trading of cryptocurrency the highest leverages I will use is x 5, because I cannot use higher than that but I've seen people that have been using x 50, it depends on a person's capital.

Considering the huge flunctuation in the market its more better to pick a smaller leverage that you know you could manage and quickly cut out your loss at the end of the day , risk management is one thing a crypto user should never forget when dealing and trading in the market to make more money i think ,so pick a smaller leverage when trading

 

[Yugocean]

Good information about leverage, this opinion works in all brooking platforms. Well known names like CMCM offers maximum 1:30 leverage, while many brokers offer high leverage like 1:500, 1:1000 etc. High leverage is used to lure newbies, while newbies are advised to understand the trading first and use demo account to learn.
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[milangaknd]

Leverage involves borrowing a certain amount of the money needed to invest in something. In the case of forex, money is usually borrowed from a broker. Forex trading does offer high leverage in the sense that for an initial margin requirement, a trader can build up—and control—a huge amount of money.
For example, if you are required to deposit 1% of the total transaction value as margin and you intend to trade one standard lot of USD/CHF, which is equivalent to US$100,000, the margin required would be US$1,000. Thus, your margin-based leverage will be 100:1 (100,000/1,000). For a margin requirement of just 0.25%, the margin-based leverage will be 400:1, using the same formula.

 

[Razor1911]

Leverage involves borrowing a certain amount of the money needed to invest in something. In the case of forex, money is usually borrowed from a broker. Forex trading does offer high leverage in the sense that for an initial margin requirement, a trader can build up—and control—a huge amount of money.
For example, if you are required to deposit 1% of the total transaction value as margin and you intend to trade one standard lot of USD/CHF, which is equivalent to US$100,000, the margin required would be US$1,000. Thus, your margin-based leverage will be 100:1 (100,000/1,000). For a margin requirement of just 0.25%, the margin-based leverage will be 400:1, using the same formula.

Exactly. Having high leverage means you can hold margin higher than what you have deposited. The extra money that is provided to you is by the broker. that depends upon the broker how much levarage is there should provide some brokers provide up to 50 times whereas some provide up to two thousand times. But at raider should carefully select the leverage too much liver is may also hurt their trading

 

[sincerem]

When it comes to forex trading, a beginner shouldn't start with high leverage,. At least he should lay his hands on the moderate and taste success and get experience how it works before applying higher leverage. Crypto and forex trading almost the same when applying the terms. Experience is needed in the two, one can't just jump in trading with $1,000 with high leverage and expecting quick success.

 

[Sotherefore]

Considering the huge flunctuation in the market its more better to pick a smaller leverage that you know you could manage and quickly cut out your loss at the end of the day , risk management is one thing a crypto user should never forget when dealing and trading in the market to make more money i think ,so pick a smaller leverage when trading

although I do not trade future in cryptocurrency but very soon I'll do it when I get the signal I need,when I Will be trading future in cryptocurrency I will not use high leverages, the highest I will go for will be times 5, that is the one I can manage now with my little money.

 

[Lens1000]

Setting high leverage could be regarded as a greed, because you are not taking into consideration the magnitude of the losses that will be incurred but you are focused on the huge profit that could be realised. If you don't manage risk well in a business then, it doesn't worth investing on. I take risk management very seriously whenever I take up an investment.

 

[Evelina5]

Leverage trading can be dangerous and at the same time exciting if the market favors you. The leverage received from a broker can amplify your profits if your trading strategy is right.