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
Professional traders use 1.5 -2% maximum per trade,anything above this is nuts.Open a demo to get some practice,but you wont really know how to trade until you have a live trade on,plus demo is set up differently to live accounts,find a true ECN broker so there is no conflict of interest.Leverage isn't really the problem if you understand it and act sensible with your stops.No over night positions until you get a feel for the market.
It is up to you to decide what is this minimum amount, broker and type of account should be taken to consideration. Personally I first time deposited minimal amount and used minimum leverage. I believe mini accs teach well without much risks.
Put minimum amount into your account until you get good at a particular strategy,then you can add to it. Leverage is not the problem,it's where you put your stop loss is,I have never had a problem with leverage,if anything it's a positive,don't be afraid of leverage.
Well, in this case, pay extreme attention to the main rules of money management. I guess it's not a secret for anyone that high leverage without proper money management can destroy one's account very quickly. Excuse me if it has been mentioned lots of times already, but I think it's better to note that one more than skip another time.
HIGH RISK WARNING: Foreign exchange trading carries a high level of risk that may not be suitable for all investors.
Leverage creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully consider your investment objectives, experience level, and risk tolerance.
You could lose some or all of your initial investment. Do not invest money that you cannot afford to lose. Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions.
Any data and information is provided 'as is' solely for informational purposes, and is not intended for trading purposes or advice.
Past performance is not indicative of future results.