It’s okay to get such simple confusions on initial stages. As you see the problem is resolved thanks to forum help and all next issues can be resolved in the same way.
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Thanks brah…anyway, how do you determine the leverage that was applied to your certain trade orders…do you have to choose everytime before an order??or you just choose and set it on your platform at the beginning and it will run through all your trade as a fix leverage ratio??thank man…
its a big broker, with decent conditions for retail traders, but its not for me
My experience is not good, I find their overnight swap charges is way way more higher. Don’t even think about them. If you are a swing trader who might need to stay for 1-2 weeks.
Other trading condition is not bad. I don’t recommend.
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Leverage is set during account opening and can be changed by request to Hotforex support. Currently my leverage is set at 1:500 but I play with the lot size to choose pip value I want and hence the profit and loss targets.
Cheers.
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Oh i see, hmnn…so your risk management is: you are the one who decide how much money you are willing to risk on a certain trade,right?..by determining your lot size you could tell the broker the value per pip you are risking when you set your stoploss?am i right?..so on my confusion…”if your broker knew already how much you are risking, Is the leverage ratio of 1:500 will still apply??..thanks man…
I think we need some example to clear this confusion:
Imagine you have 500 USD in your trading account.
with 1:500 leverage the max position you can open is 500*500=250 000 USD or 2.5 lots. (for USD/XXX pair)
with 1:100 leverage the max position is 500*100= 50000 USD or 0.5 lot.
For simplicity I didn’t take into account transaction costs like spread, slippage etc.
Now let’s imagine we want to open a trade with pip value of $1. Then the lot size should be 0.1 lot since pip value for 1 lot is 10$. With 1:500 leverage required margin will be 10000/500 = 20 USD. 480 USD is free to open other trades.
But in case of 1:100 leverage required margin is 10000/100=100 USD. Only 400 USD free to open other trades in this case.
As you can see one of the differences between leverages is the amount of money broker locks for a particular trade. Also, max possible lot size for 1:500 leverage is 500500=2.5 lot, for 1:100 leverage - 500100=0.5 lot.
Here we can conclude that leverage doesn’t affect pip value.
Thank you brother, Now I have something to contemplate for…I’ll save these message and squeeze every last drop of juice out of it in order to grasp the concept…thank you very very much,its crucial information on my money management that sucks…
Good, feel free to ask any other questions if you have.
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thats a detailed explanation thanks for the share… and well just another somehtitng for new traders, try to stick too smaller lots and smaller leverage. it will go a long way
Yes lower leverage prevents you for opening large positions, i.e. losses will grow slower in case of adverse events
You can trade currencies with positive swaps.
What do you mean? Is the goal of such trading should be earning swaps or profit from currency swings? Sometimes it’s really hard to make a decision on this.
Yes, indeed. Positive swaps currencies are not the one you can make correct prediction.
Do you trade exotic pairs like USDRUB or USDZAR? Many traders which asked about this say that they fear trading exotics because of higher volatility and local political and economic factors which are unpredictable. What do you think?
I never stick to rare pairs because of its high votality, however, if you’re a scalper, exotic trading is a good choice.
Nah, exotic pairs have high costs for scalping, I think fundamental analysis works better on them, because less factors affect their movement.
thats what i love about forex, there is a something for everyone, some are good with exotics others stick with majors etc. yout will always find something that suits you…
Can we deposit/withdraw by Bitcoin and other crypto with this broker?
yup you can, but different options offer different min amounts of deposits, check first with support though just to be sure…