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High leverage = High risk?

unsightlydray
Feb 24 at 08:14
53 Posts
robindude posted:
Yes
High leverage = High risk = High chance of wiping out your account/funds

And is there any way of earning decently without using leverage? I doubt it!


unsightlydray
Feb 24 at 08:15
53 Posts
78678676 posted:
A higher leverage is way too risky, specially for a newbie who can end up getting himself trapped in a bad debt.

Debt?? I don’t intend to take up a loan for trading, as wrongly (I think) suggested by a friend!

shaunmarsh
Feb 24 at 09:22
65 Posts
Frankly, I agree with most of the suggestions here. We all know that the chances of making profits in the forex market are equal to that of making losses. Although I have chosen brokers that offer high leverage - fxview, exness, I kind of avoid it. I am saving it for the times when I will be more sure about my moves.

Marlonsmith
Feb 25 at 04:56
28 Posts
As long as you know what you are doing, leverage is a good thing. But if it goes against you, it can quickly deplete your account. Use leverage only when you are ready for it. Also, never forget to use reasonable stops to avoid a higher loss of capital.

Ebin
Feb 25 at 13:56
24 Posts
High leverage is considered risky because when a trader loses in a trade with high leverage, the loss also results in a large amount, whereas if the trader can convert it into a successful trade, the profit earned is more than the invested amount.

LyudmilLukanov
Feb 25 at 17:28
419 Posts
New traders should not use high leverage in trading. Traders need to control and minimize the risk for using high leverage.

Jakemark
Feb 27 at 11:33
37 Posts
See, no doubt that there is a high level of risk with high leverage but the only thing matters is how much knowledge and experience you have for taking such risks.

Ramierez
Feb 27 at 13:25
20 Posts
Using higher leverage in a live trade is risky to traders with less or no experience in trading because if trader losses with higher leverage, it is possible for those traders to blow up their accounts.

marco_mmbiz
Feb 27 at 14:25
363 Posts
unsightlydray posted:
78678676 posted:
A higher leverage is way too risky, specially for a newbie who can end up getting himself trapped in a bad debt.

Debt?? I don’t intend to take up a loan for trading, as wrongly (I think) suggested by a friend!


Actually 'leverage' just means that you'll get a 'credit' from a bank or liquidity provider of the broker. A max. account leverage of 1:500 means that you can trade with a maximum of 500k per trade (!) while you'll only throw in 1k of your own money. But if you'll lose 2k in that trade, where does the other 1k come from then? Right, it comes from your deposits (and that's how can get into debt). Most professional brokers have a negative balance stop out. But the higher your leverage the higher the chance you'll get to this stop out.

unsightlydray
Mar 01 at 08:22
53 Posts
LyudmilLukanov posted:
New traders should not use high leverage in trading. Traders need to control and minimize the risk for using high leverage.

But it is so darn appealing I say :) why not risk some

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