We all have heard that you should not trade with a very big leverage due to risk management and such things; but today i was calculation things for my trade and i realized something! well, lets say that you wanna go long on EURUSD with 1 lot of volume, now when I calculate that with a leverage that a friend of me uses (1:100), and then compare it with the leverage that I use (1:3000) it looks like, i would have a smaller margin requirement, which leaves me with a bigger free margin and then the margin level for me will be bigger and I will have a more healthy trade?! am i making any mistakes or is it true that a bigger leverage in forex is actually less risk?!
The main way it increases the risk (totally underestimated by most people) is that a broker offering high leverage cannot possibly - by definition - be properly regulated.
The importance of this point eclipses other considerations, really.
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so if the broker is reliable, higher leverage reduces the risk?
What?! No, totally wrong! If there’s high leverage available, then the broker ISN’T reliable (even if it looks reliable, and even if you think it is: it can’t be because it’s a broker that has CHOSEN not to be properly regulated!).
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man i am saying higher, like 50 comparing to a 100 not necessarily a leverage of 999999999999, is it so hard to really get what i say? if a damn broker is reliable does this mean that the bloody higher leverage is safer than a damn lower leverage? let alone reliability i am talking about a hecking risk management strategy not about choosing a broker!!!
Chill mate, these suggestions are solely for your own good and I don’t know why are you arguing.
Look I use a high leverage broker and let me explain it this way for you. Leverage has a potential to reduce your risk-reward ratio and even reduce the amount that you might lose in a lost trade BUT that is if you know how to use leverage.
My recommendation is, see how much you can invest with your capital and with little to zero leverage. Then use your maximum leverage to reduce your risk-reward ratio and margin required. Now when you do this everything is fine and you won’t face any problems or even risks. But you should practice restrain and keep your greed in check, so you don’t over-trade or open higher volume trades.
Look I see your point of view and you are right to warn people about potential scams that might happen due to lack of regulatory framework but I have worked with both regulated and unregulated brokers, and the thing is you can find reliable unregulated brokers.
For instance, I called fxglory’s support team to learn why they refuse to be unregulated even though they claim to be operating for more than 10 years or something, the agent simply replied, due to aggressive promotions that they offer they cannot find a regulatory firm that will accept their conditions. So basically, it’s either promotion or being regulated.
Lol. That’s just not true, though, Phonix. That isn’t something that proper regulators restrict in any way: it isn’t any of their business and it isn’t what they’re there for.
Sorry, but honestly it’s just laughable: the “line” that the rep fed you is just nonsense - it’s what their sales and support people are trained to say to people who ask “awkward questions” about why they’re not regulated.
In the long run, it’s really important not to be fooled by stuff like this.
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You’re not naive enough to believe that, Phonix. I know you’re not. I see your posts and I know you’re a realist.
There are also properly regulated brokers quite lawfully doing promotions (Oanda do a lot, and nobody’s better regulated than them!), so their story makes no sense, and you know it, really! 
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sing bigger leverage does lower your margin requirement and gives you more free margin, but it also increases risk. If the market moves against you, the potential loss could be much larger
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I don’t claim to be a brokerage expert. I can only tell from experience and also it could be true what you are telling me that he fed me a bunch of bs, but it made sense at a time. You don’t see a lot of brokerages with 1 to 3000 leverage
But for the sake of argument can you name me a brokerage that offers a high leverage is regulated as well? Because by the looks of it, I failed to find one yet.
Are you in fact an affiliate/introducing-broker for an unregulated, offshore, high-leverage brokerage, please, @Phonix ?
(I’m not asking which one!).
I’ll apologise if I’m mistaken, of course, but the way you frequently discuss this here, and what you say each time, really make it look like you must be.
I think members reading your posts should be told openly, if you are.
That’s fair enough, isn’t it?
We’ve drifted far from the topic here. The main topic is about using high leverage and whether it can increase/decrease the risk! Now if you have something against unregulated brokers and don’t want to even consider or even imagine using a high leverage, that’s totally fine and I understand it. But that doesn’t change the fact that someone can find a broker that could be reliable and unregulated at the same time, but then again this is not the topic!
And I have nothing against using a broker like Oanda but that broker doesn’t offer a leverage higher than 1 to 50.
That can happen, in forums.
But are you in fact an affiliate/introducing-broker for an unregulated, offshore, high-leverage brokerage, please, @Phonix ? A direct answer to a direct question would be helpful. Thanks in advance.
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I don’t recommend an unregulated broker to anyone unless they straight up ask me what broker that I use.
and it’s ok if you misunderstood what I’m trying to imply here.
Nobody’s accusing you of anything improper or dishonest, here, Phonix.
I’m simply asking you whether you’re an affiliate/introducing-broker for an unregulated, offshore, high-leverage brokerage, because your views on this subject, and the way you express them, certainly make it look like you are.
And what you said above does not dispel that impression, either.
But if you don’t want to answer my very simple question, I will have to accept that, and perhaps respectfully suggest to other members that when they read what you say on this subject, they may want to decide for themselves whether or not you’re an affiliate/introducing-broker for an unregulated, offshore, high-leverage brokerage, and interpret what you say according to their impression of that.
Tbh I think I did answer you when I said I don’t promote unregulated brokers, and people who can read my comments on anything can surely see that my opinions are unbias, but if you think otherwise, I respect your opinion.
Back to main topic, using a high leverage is not for everyone and tbh you might end up blowing your account, but if you truly are skilled and know how to manage it, it can reduce your R ratio. I mentioned something similar in some other topic.
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