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High leverage , High risk ?

AmDiab
Nov 11 2018 at 08:18
718 poster
millerwe posted:
RichPort posted:
That is a lot of the problem here. People assume high leverage is high risk and low leverage is lower risk but it is all about how you set up a trade and manage your account. I dumb trader can wipe out an account on low leverage just as easy as high leverage

totally agreed. people need to understand how money management works and operates that's the main issue. leverage can result into huge profits if money and risk management are done right.


I agree with you mate! Traders need to consider the money management issue so sincerely! Unless having a good plan, high leverage would be costly for sure.

jamesgwyther
Nov 12 2018 at 09:14
289 poster
AmDiab posted:
millerwe posted:
RichPort posted:
That is a lot of the problem here. People assume high leverage is high risk and low leverage is lower risk but it is all about how you set up a trade and manage your account. I dumb trader can wipe out an account on low leverage just as easy as high leverage

totally agreed. people need to understand how money management works and operates that's the main issue. leverage can result into huge profits if money and risk management are done right.


I agree with you mate! Traders need to consider the money management issue so sincerely! Unless having a good plan, high leverage would be costly for sure.


Money Management is probably more important even than your trading strategy.

pipsKeeper
Nov 13 2018 at 11:55
19 poster
TeraPips posted:
pipsKeeper posted:
All that was posted before here is really true. I have some question. Why it's more often when brokers suggest beginners to start with a big leverage? The issue is beginner will lose more with the leverage of 1:1000. I suppose that it's better to start with small (1:100 for example).


Agree with 1:100 but make sure you have basic knowledge of using it through demo and be aware of your psychology issues which should not interfere trading. You won't want to blow account quickly (with overtrading or revenge trading which is common).
You are right. I did not take into account the fact that a beginner often does not have good money management. The leverage 1:100 should be used with balanced strategy.

Jingyi
Nov 15 2018 at 11:19
8 poster
A beginner will lose it all on 1:1000 or 1:10. I think there should be enforced use of demo account for 1 month before open live account and a video course on risk management that all traders must watch before account is opened. That would help people a lot more

togr (togr)
Nov 15 2018 at 14:36
4862 poster
Jingyi posted:
A beginner will lose it all on 1:1000 or 1:10. I think there should be enforced use of demo account for 1 month before open live account and a video course on risk management that all traders must watch before account is opened. That would help people a lot more


Even after ESMA which limits leverage drastically there is no decrease of losing traders.

TiffanyK (TiffanyK)
Nov 16 2018 at 08:37
427 poster
togr posted:
Even after ESMA which limits leverage drastically there is no decrease of losing traders.

Indeed. The only difference is that they have to deposit bigger amounts of money in order to lose.

Accept the loss as experience
Imamul
Nov 18 2018 at 12:50
595 poster
For avoiding risk I always use 1:100 leverage in spite of having up to leverage 1:2000 , actually leverage is an important financial tool which always contains risk , so it is better if we avoid using high leverage in real account.

Adribaasmet
Nov 19 2018 at 11:11
947 poster
Imamul posted:
For avoiding risk I always use 1:100 leverage in spite of having up to leverage 1:2000 , actually leverage is an important financial tool which always contains risk , so it is better if we avoid using high leverage in real account.


Same to me! I think, most of the retail traders who are aware of money management issue they are playing with 1:100 trading leverage.

Mohammadi
Nov 24 2018 at 10:21
886 poster
Trading with high leverage in demo account is right decision , because leverage contains always higher risk in live account , it could be dangerous at any time despite of most accurate trading plan .

Adribaasmet
Nov 25 2018 at 08:14
947 poster
Mohammadi posted:
Trading with high leverage in demo account is right decision , because leverage contains always higher risk in live account , it could be dangerous at any time despite of most accurate trading plan .


I don’t think it’s a good idea. Because, we need to treat in the demo as like our live. Same strategy, same plan even same mental preparations.

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