AliKhan1 posted: 1:100 would be okayy aswell ... People go crazy with 1:400++
The truth is that extreme leverages are not the best for the new trader. Leveraged trading might seem attractive as it could be amazing controlling $40000 with just $100 when you use a leverage ratio of 1:400. But with what I have seen in the forex practically, leverages might seem lucrative with the possible profit you could make from a leveraged account but the true reality is that it requires good experience to properly operate a highly leveraged account and eventually not get a margin call. Especially as there is no guaranty that prices wouldn't go against your direction. On the highest end, I think a leverage of 1:20 is almost enough if well done with proper risk management.
Ja, some spectacularly bad answers here. For most MT brokers around you need about $100k if you intend to have any chance to make it at all.
The reason is very simple. Regardless of how much leverage you have, most of them have 0.01 lots minimum trade size on 100 000 unit size lots. The brokers that do offer small lot sizes are for the most part not reputable with one notable exception.
To put that into perspective, the value of your trade is : current price x lot size x lots
So in EurUsd at current prices 1.09 x 0.01 x 100 000 = 1090.
If your account has $200 in it, or $500 or even $1000 your minimum trade sizes are far more than the actual value of your account. In fact when you get to $100k only is it about 1%.
Doesn't matter what you're going to do, the account will not survive unless you're one of the top 1% of traders in the world. That's why so many people fail at fx. You're better off taking that money and buying beer with it or watching movies or buy the wife something. Putting a few hundred into fx is just a waste of time and money.
There is one broker that will allow 1 unit trades. Oanda. I suggest opening an account with them and doing a demo till you're happy you can pull it off. Then start with very small trades and up your trade sizes as a percentage of equity as your confidence grows.
Ultimately it's your DD that decides how much money you can make. Not your leverage and not your start amount.
Leverage needs are different to every trader, depends on your strategy and how much money you plan to risk on every trade, anything above 5% risk per trade is suicide, 3% is already a good number.
If (for example) you plan to eventually open an account with $5,000:
1. open a $5,000 demo account and trade with that for a few months untill you become profitable. That way you will have time to test and try your system and emotions.
2. Once you are profitable on demo start with a real account, but fund it only with $1,000 (out of your $5,000), wait until you are profitable, at least one month.
3. Deposit up to half of your capital, wait until you are profitable. At least one month.
4. Deposit the whole amount
You wil: a) learn to trade first with demo funds, b) you will learn to control your emotions first with a small amount of money c) You will not risk your capital until you feel safe and you can really trade d) You can use all the time it will take you to become profitable to save the money to finally fund your real account
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