Yeah I had trouble with this one too, but what leverage does is that the higher it is, the more lots you can trade. That is all. It is not riskier to trade 10K lots on 50:1 leverage or 10K lots on 100:1 leverage with the same amount of money in the , since it is the same but with 100:1 leverage you need $100 minimum to enter a 10K lot and with 50:1 you need $200. But of course, that is assuming that there is no spread. I'll give you better example. Say you deposit $1000 into two mini accounts. 1 has 50:1 and the other has 200:1. Now when you trade with the 200:1 leverage, you can trade at every level of the amount of lots they give you (100K), but with 50:1you can only trade around 40K lots if I'm not mistaken. The only thing that leverage does is the greater the leverage, the less money you need to trade with. The leverage itself isn't risky, but increasing the lots is, when you have such high leverage. If you still don't understand, what I had to do to fully grasp the concept was open two different mini accounts with different leverages, and play around with the amount of lots you can trade. Have a good one eh!
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