How can i trade without leverage?

I want to know if i can trade with no leverage (1:1) with a capital of 100,000$ and what the is the maximum size position i can trade with?

You don’t have to use the leverage offered to you by your broker.

Regardless of the leverage offered – 50:1, 100:1, etc. – you can trade with zero leverage by keeping the notional value of your positions smaller than your account balance.

If you have a $100,000 account balance, then by keeping the total notional value of all your open positions at any one time below $100,000, you will be trading with up to 1:1 leverage (which actually means trading without using leverage).

If you want to know the maximum size trade you can take without using leverage, the answer is obviously a trade with a notional value of exactly $100,000.

Make sure you know what notional value is, and how to calculate it.

Here’s an example:

Suppose you want to trade EUR/USD in a USD-denominated account. Your account balance is exactly $100,000. You want your EUR/USD trade to be as large as possible, without requiring the use of leverage. In other words, you want a position with a notional value exactly equal to $100,000 (or as close as you can get to that amount, without exceeding it).

Let’s say the price of EUR/USD at the time you enter your trade is 1.2250. This price means that one unit of EUR is worth $1.2250.

How many units can you trade without exceeding a notional value of $100,000 ?
The answer is $100,000 / 1.2250 which equals €81,632.65. In other words, 81,632 units of EUR/USD.

So, you cannot trade a full standard lot (100,000 units) of EUR/USD, because the notional value of that position would exceed your account balance.

You can trade 8 mini-lots, with a notional value of €80,000 which equals $98,000 (80,000 x 1.2250).

Or you can trade 81 micro-lots, with a notional value of €81,000 which equals $99,225 (81,000 x 1.2250).

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You can certainly trade without any leverage if you want. But personally I don’t think its a good idea. I dont say go for unrealistic leverages like 100X, 500X etc, but a decent leverage till 50X is helpful. Leverage basically reduces your margin requirement. So if you are not using any leverage, you would need the exact or more balance in your account to trade a particular trade. For example, if you want to trade 1 standard lot of EURUSD (market price be 1.23643) knowing that 1 lot has 100K units of EURUSD, you would need a capital of 100K*1.23643 = 123,643 USD which is a lottttttt of money. So its better to reduce it down using leverage. If you take the leverage of 50X it will be reduced to 50 times and you would only need 2,472.86 USD.

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its a very nice calculation you have done already , thanks for your nice post.

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i hope you already got the answer , most of the traders above all beginners level dont know that it is possible to trade without leverage , they use high leverage and face loss at the end of the day.

yes , newcomers should not trade with leverage , because at the early stage leverage can make beginners greedy and emotional.

Very well explained.

Thank you very much for your help, it is very clear for me now :slight_smile:

The calcule is the same for gold or Silver ?

Yes, you can surely trade with 1:1 leverage. Many brokers offer the same.

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I am glad to know that you are not focusing on using high leverage to make profits in the market. And yes, you can trade without using leverage offered by your brokers. Build a strategy and you are good to go.

But they can surely work on some demo accounts and practice. No harm in that right?

I think using low leverage would work fine for them. I read it somewhere that 1:100 leverage is safe to use. It works both for beginners and advanced traders. However, some experts like to use a very high leverage which is much of a risk which they’re willing to take. The profitability increases with high risk.

Yes, it is possible to trade without leverage, but the reason why traders prefer trading with leverage is because of the profit earned.

Trading without leverage gives lower profit which is nothing but peanuts, whereas using leverage offered by brokers brings in a reasonable profit.

You’re right about the leverage. Keeping it to 1:100 allows a trader to risk less and create a balance in their trades. It is completely okay to go with such a low leverage. I mean I never go beyond 1:200 with my brokers Xm, Fxview. Works really well for me and I get to manage my money and risk simultaneously.

Yeah they should not use leverage if they want to learn. Could be very risky for newbies to use any leverage. Not advisable.

Trading without leverage is possible but it can directly hit the trader’s bottom line, you would hardly make good profits without leverage

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Yes you can definitely trade without leverage but for a new trader it is not a good idea, as leverage helps you to reduce the margin required for placing trade and you require less capital. But don’t go for high leverage, have a leverage of 1:30 or 1:50.

I’m a beginner and would like to know if I can trade live without any leverages to minimize risks and losses?

Yes you can. In fact there are many brokers who allow traders to trade without any leverage. However, do keep in mind that with the amount you’ve mentioned and no leverage, your profit would be influenced in case there’s any change in the asset price. As far as the lot or position size is concerned, I guess it’s 500.