[think]

Hi,

I am not sure I fully understand Margin and Leverage yet and I am not prepared to even open a demo account until I know exactly what's going on...

The BabyPips school recommends the following minimum balances for opening these different account types:

$1000 - Micro
$10000 - Mini
$100000 - Standard

Based on my calculations, I can't see why it is a bad idea to open a Mini lot with $2000. For example,

- I plan to have a rule that says I will never risk any more than %3 of my equity in a trade..
- %3 of $2000 = $60
- If I were trading GBPUSD, each pip would be worth about $1

If I only open 1 mini lot, I can sustain a 60 pip move against me.

If I am confident about a trade, I could apply my rules and open 2 mini lots, reducing my S/L to 30 pips. Risk is still 3%.

I can't see anything wrong with this. Am I missing something? What's wrong with using this set of rules with a .25% margin requirement?