Understanding Leverage in Forex Trading and the Dangers of Margin Trading | Forex
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Leverage and the Dangers of Margin Trading. Zoe Fiddes, Head of Sales at ORE Tech comments. Leverage can vary hugely from one broker to another; the standard leverage in the forex market is 1:200 leverage. So if you're trading a $100,000 or 1 lot in MT4 terminology, then you would have to put in $500 of your own money. So in recent years we've seen brokers offering leverage of up to 1:500 and this is also demanded by clients but more leverage means more risk
Comments
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Thank you for your clear explanation of how margin trading works. Very helpful :)
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Forgive me for sounding like a idiot. So if I have £100 deposited and leverage at 100-1which gives me £10000 to trade with. If I lose all of the £10000 am I liable to pay back the £9900 hypothetically.