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High leverage = High risk?

unsightlydray
Feb 02 at 04:54
53 комментариев
Tradelist45 posted:
right now i am using high leverage most of the time in demo ,
 it supports me to avoid unfortunate risk and losses when trading in a real account.

I don’t get it! Did you actually mean you are using “high leverage” which is keeping you safe????

unsightlydray
Feb 03 at 06:14
53 комментариев
blandpatsyy posted:
Leverage sure is a double-edged sword, but without leverage trading would not bring in any scalable results. That is unless you have heaps of money to invest. How much would a movement of a few pips give on 3 or 4k. That also might be considered a big amount for a lot of current investors in the market. Considering most are part-timers, and some even college lads.
Had it not been for leverage, I would have stopped after meagre earnings. Still trading solely because of high leverage.

You’ve just echoed my thoughts, without margin trading I doubt I will be able to make any money here. Thanks for the motivation :)

unsightlydray
Feb 03 at 06:19
53 комментариев
blandpatsyy posted:
Garrywilson posted:
I find it too risky to use leverage. Can’t imagine owing money to the broker and defeat the whole purpose of being in the market.

If you use a broker that offers negative balance protection, there’s no way that you’ll be risking owing anything to the broker. Then there’s stop loss as well to the rescue. If I’m not wrong all brokers offer these features, and if yours don’t, simply transfer your funds to a better broker.

The ones I checked yes, and isn’t it mandatory for brokers to provide negative balance protection?

josejames
Feb 03 at 10:35
16 комментариев
RelySmith posted:
blandpatsyy posted:
Garrywilson posted:
I find it too risky to use leverage. Can’t imagine owing money to the broker and defeat the whole purpose of being in the market.

If you use a broker that offers negative balance protection, there’s no way that you’ll be risking owing anything to the broker. Then there’s stop loss as well to the rescue. If I’m not wrong all brokers offer these features, and if yours don’t, simply transfer your funds to a better broker.

I doubt if Robinhood offers negative balance protection

It doesn’t need to, Robinhood simply doesn’t allow short selling. But sadly there’s no forex option there. So I had to make an account with Fxview. Zeroed in on this one cause of the wider currency options. And ya, they very clearly offer negative protection.

Chelsea Blacks (blackChelsea)
Feb 03 at 11:54
98 комментариев
I think when newbies enter the live forex market, they want to book more profits with very small amounts, so leverage attracts them. But it should be kept in mind that leverage is associated with a certain amount of risk. While it can push your trades to make profits also at the same time it can put you in loss which is even more than your balance you have. When I started, I used to look for a 1:30 leverage ratio with a minimal balance that I can handle. This keeps my risk minimal. You can gradually increase your leverage ratio depending upon your earnings and understanding.

unsightlydray
Feb 04 at 07:43
53 комментариев
blackChelsea posted:
I think when newbies enter the live forex market, they want to book more profits with very small amounts, so leverage attracts them. But it should be kept in mind that leverage is associated with a certain amount of risk. While it can push your trades to make profits also at the same time it can put you in loss which is even more than your balance you have. When I started, I used to look for a 1:30 leverage ratio with a minimal balance that I can handle. This keeps my risk minimal. You can gradually increase your leverage ratio depending upon your earnings and understanding.

I understand, and so I am not going to rush into any trade. I will start with safe pairs like EURUSD and then try my hands with other pairs.

Johnathankim
Feb 04 at 08:33
29 комментариев
Garrywilson posted:
ddarko3 posted:
unsightlydray posted:
As someone with just a few dollars extra to give trading a shot, would it be possible at all to gain anything without the use of leverage? And is it even wise to use up all of your own cash?

Technically leverage helps you to gain more but the problem with them is that you can also lose completely

I completely agree with you, and sadly it’s the losing part that happens more.

That is because most new traders simply want to start making millions right from the very start. They overtrade, they get greedy, and treat trading more like gambling. They pay the price through increased losses.

blandpatsyy
Feb 04 at 11:24
42 комментариев
Johnathankim posted:
Garrywilson posted:
ddarko3 posted:
unsightlydray posted:
As someone with just a few dollars extra to give trading a shot, would it be possible at all to gain anything without the use of leverage? And is it even wise to use up all of your own cash?

Technically leverage helps you to gain more but the problem with them is that you can also lose completely

I completely agree with you, and sadly it’s the losing part that happens more.

That is because most new traders simply want to start making millions right from the very start. They overtrade, they get greedy, and treat trading more like gambling. They pay the price through increased losses.

If proper attention is paid to risk management, then high leverage can be used.

Marksteve
Feb 05 at 10:16
36 комментариев
Leverage is indeed 2 sides of the same coin. On one side it will give you major exposure and on the other poses a likelihood of draining all of your funds.

forextrader777
Feb 05 at 11:23
105 комментариев
High leverage attracts new traders but few of them know the actual working of leverage. I would recommend that before pushing yourself into the trades that need margin, try to understand the concept clearly, otherwise it can wipe off your account balance.

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