Interesting Question regarding leverage and trading style
Results 1 to 8 of 8
  1. #1

    Default Interesting Question regarding leverage and trading style

    Ok hereís a predicament:

    Does your trading style affect what leverage you should use?

    OR

    Does your leverage affect your trading style?

  2. #2
    Join Date
    Dec 2006
    Posts
    11
    Definitely your trading style comes first. You should never have to adjust your trading style because of the leverage you are using. Determine your trading style first. When you can comfortably make positive pips then you can worry about the leverage.

  3. #3
    Join Date
    Dec 2006
    Posts
    10
    I donít even know why traders would want high leverage. Brokers always seem to push this but I think you have a lot more flexibility as a trader if you use lower leverage.

  4. #4
    Well in response to the leverage comment, I think traders use the leverage because it has the lowest margin requirement. Some people use very high leverage (400:1) for different hedging strategies for the low margin requirements but I agree to some extent that most traders should try to keep their leverage low.

  5. #5
    Join Date
    Dec 2006
    Location
    Miami, Fl
    Posts
    2
    You should find your trading style first. Thatís the most important thing. Everything else can be adjusted around that.

  6. #6
    Join Date
    Dec 2006
    Posts
    184
    I never really think about leverage in and of itself. In risking only 1-3% per trade the leverage, by definition, will be low. Think percent risk, not leverage and life becomes simpler

  7. #7
    Join Date
    Dec 2006
    Posts
    18
    Quote Originally Posted by pipbull View Post
    I never really think about leverage in and of itself. In risking only 1-3% per trade the leverage, by definition, will be low. Think percent risk, not leverage and life becomes simpler
    This is an interesting approach to see things and gain more perspective in the long run, I think. At least what I am reading, gets me more to think in the percentages. Then again, I am still learning the roads to get to the real deal highway of trading!

  8. #8
    Join Date
    Nov 2006
    Posts
    8,766
    Pipbull makes a good point. Think in terms of risk exposure and you won't have to worry about leverage. In my opininon, if you're a fairly new forex trader, and you've demo traded for at least 3 months (right?), only risk .25 - .5% of your trading capital. And not just per trade but for TOTAL RISK EXPOSURE. This will (hopefully) keep you in the game long enough for you to actually start learning how to trade profitably or at the very least, put you in the best position.

Forum Sponsors

Similar Threads

  1. Question regarding a quote about forex trading. :p
    By kingen in forum Newbie Island
    Replies: 4
    Last Post: 04-20-2014, 10:25 AM
  2. Noob Question regarding indicators and software.
    By shoryukeith in forum Newbie Island
    Replies: 2
    Last Post: 01-11-2011, 03:47 PM
  3. A question regarding Support and Resistance levels.
    By Kuzco in forum Newbie Island
    Replies: 6
    Last Post: 12-05-2010, 10:53 PM
  4. Newbie question about leverage and margin
    By racerx in forum Newbie Island
    Replies: 10
    Last Post: 12-07-2009, 04:08 PM
  5. Question regarding long and short (exchange rate)
    By greenday646 in forum Newbie Island
    Replies: 1
    Last Post: 07-29-2009, 01:42 PM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
"Everyone thinks of changing the world, but no one thinks of changing himself."
Leo Tolstoy