Quote:
Originally Posted by phildunn
Most people prefer higher leverage because u can use less margin to trade same lot size.
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I am totally agree with you, phil.
Leverage is wonderful tools to trick low capital account, since we use less margin to open an position. BUT DONT USE IT for GREED, Its will Zero-ed your account very quickly.
Simple example :
Capital $1,000
Open Fiber at 1.3300 at 0.2 lot
Leverage 1:100
>>We need 266$ to open that position and only 734$ left to hold risk.
Leverage 1:200
>>We need 133$ to open and we still have 867$ fund
Leverage 1:500
>>We ONLY need 53.2$ to open and we have plenty fund left.
BUT Please dont use leverage to open bigger position (because need less margin), money management is NEEDED here.