Is a 1000:1 Leverage good

[maxmadre]

I have been having problems to deicde

[Franca_Bridge]

No. It’s terribly bad and it would be a big mistake to use it.

Here are the (recent) threads explaining why, which will help you. Click the green links, and read well!

Best broker for indices cfd? index 500 leverage 0.01 step and volume

It’s much easier for some people than for others, according to their beliefs about what’s “good,” in this context. The most relevant point to understand is that “high leverage” and “properly regulated” are two mutually exclusive things, for the simple reason that proper regulators are not allowed by law to let the brokers they regulate offer high leverage. It follows from this, that if your current aim is to use a high leverage broker, then it can’t possibly be a “good” one according to anyon…

Beginner question - leverage and trade example

I trade cable, for example, 1 mini-lot for $1 per pip. I start a long trade, open at 1.2500, my take profit is 1.2515, my stop loss is 1.2475. If this trade is a winner, then I win $15 for 15 pips x $1, and if this trade is a loser, then I lose $25 for 25 pips x $1. It is right, so far? All of this is right if my leverage is low like 1:10, and it is right and exactly the same results if my leverage is medium like 1:50, and it is right and exactly the same results if my leverage is high like 1:…

Which broker do you recommend that has 1:2000 leverage and is regulated?

Are you serious?! The criteria you mention are, by definition, mutually exclusive. This may help you - But, as other members have recently told you, you’ll be able to ask better questions if you start here -

[SchmaltzHerring]

@Franca_Bridge

No. It’s terribly bad and it would be a big mistake to use it.

Not much to add to that, really.

It seems to be a difficult issue for beginning traders to understand. I think that’s maybe mostly because of misunderstandings about regulation and betting against counterparties.

Welcome to the forum, @maxmadre . Avoid any broker offering more than 1:30 leverage (1:50 in America). Using more leverage than that won’t have a happy ending for you.

[EmeraldEyes]

Leverage is expressed as maximum leverage. Just keep your leverage under control. You can still use 30:1 leverage with a broker offering 1000:1.

Ie: Account balance of $10,000. Only buy $300,000 worth of currency out of the $10,000,000 available.

[Hiromi_Ishii]

@EmeraldEyes

You can still use 30:1 leverage with a broker offering 1000:1.

You can, if you really want to, but you’d still be doing so knowing that the broker’s avoided real regulation that can protect its customers - not everyone’s choice, Ryan, to put it really politely.

[ria_rose]

Hellooo! I think the others here have already given very good tips for this. But just in case you need additional resources to help you decide, you can also check out the school here. It has a whole chapter dealing with leverage and its pros and cons. Good luuuck!

See How Leverage Can Quickly Wipe Out Your Forex Account

[maxmadre]

Thanks for the great advice

[maxmadre]

so which leverage do you advice is best for starters

[SchmaltzHerring]

@maxmadre

which leverage do you advice is best for starters

It doesn’t matter all that much, because as @EmeraldEyes said, above, the figure quoted is just a maximum and you don’t have to use all that, anyway. The important question, therefore, isn’t “What leverage is best?”. It’s “What MAXIMUM leverage is best (whether you use it all or not)?”.

The point: if the broker will allow its customers to use more than 1:30 (or 1:50 in America), then that proves it can’t be a properly regulated broker, so you should never trade there at all, with any leverage.

In that sense only, the cut off figure is 1:30 (or 1:50 in America). But that’s actually the only important “sense” anyway.

[PrestonRiver]

well, i guess most people will say its not good and is risky but i personally believe it is a very good feature if you can control your emotions and avoid over trading and have a solid risk management system

[Franca_Bridge]

@PrestonRiver

i personally believe it is a very good feature if you can control your emotions and avoid over trading and have a solid risk management system

But if you can control your emotions, avoid overtrading and have a solid risk management system, then you might just be one of the very few customers of such a broker who could manage to do very well and want to withdraw big profits.

How will having a solid risk management system, the ability to control your emotions and to avoid overtrading help you to get paid out, when there’s no regulator to make this offshore, unregulated “broker” give you your money?

The other 99% of the customers aren’t the ones who are complaining about these crooked brokers: only the very rare big winners.

The two key questions to ask yourself, before sending money, are -

1. Would I send my funds to be deposited in an unregulated offshore bank claiming to offer a service that’s not legal in regulated jurisdiction, and are these offshore counterparty market-makers pretending to be brokers really noted for being more reliable than banks? And -

2. Why have these people CHOSEN not to be properly regulated: is it to protect me or to protect them?

Sometimes decisions become a lot easier, when you know the relevant questions to ask.

[Johnny1974]

Same as a fast car, you don’t have to go fast - just make sure your brakes are working if you do.

[Margaretwantstotrade]

I truly do not have any idea, my mind is really screwed up rn, I did not close my damn trade by mistake and I am about to cry

[livingformoney]

It depends how you handle the 1000 times pressure. SIMPLE!

Exposure is both ways!

[Slonce]

True, I think 100:1 is sufficient to start with.

[TheodoreThring]

@Slonce

100:1 is sufficient to start with

This is awful advice, because a broker offering 1:100 leverage is exactly the same as one offering 1:1,000 leverage in the single most important sense that both are - by definition - brokers that have chosen not to be regulated.

Did you read the thread at all? As it stood, it was helpful to beginners. What we should try to avoid is having the thread fill with nonsense-comments, perpetuating misinformation (ike so many others) so that it can help nobody!

@Franca_Bridge

The two key questions to ask yourself, before sending money, are -

1. Would I send my funds to be deposited in an unregulated offshore bank claiming to offer a service that’s not legal in regulated jurisdiction, and are these offshore counterparty market-makers pretending to be brokers really noted for being more reliable than banks? And -
2. Why have these people CHOSEN not to be properly regulated: is it to protect me or to protect them?

Those are the sentences that people wanting to learn something (rather than to perpetuate misunderstandings and misinformation) need to see.

[Slonce]

@TheodoreThring

This is awful advice, because a broker offering 1:100 leverage is exactly the same as one offering 1:1,000 leverage in the single most important sense that both are - by definition - brokers that have chosen not to be regulated.

Did you read the thread at all? As it stood, it was helpful to beginners. What we should try to avoid is having the thread fill with nonsense-comments, perpetuating misinformation (ike so many others) so that it can help nobody!

I see your point, and I appreciate the discussion. My intent was to add perspective, not to mislead.

[PrestonRiver]

@Franca_Bridge

when there’s no regulator to make this offshore, unregulated “broker” give you your money?

This is a very common mistake that most traders make! have traded with brokers offering 1:2000 and 1:3000 leverage and they did pay my withdrawals , and if I am right (cannot say for sure) one of them also did hold a regulation, big leverage is not necessary a sign of scam brokers! And the second-very-big mistake that you made, why do you think only American and EU regulators are valid? do you think the whole world are scammers and the only ethical people are americans and the ones living in the EU? not even the whole europe, just the few countries in EU + the US?
or do you think only these places have regulators?

[NeitherFishNorFowl]

@PrestonRiver

big leverage is not necessary a sign of scam brokers

It is 100% a sign that the broker deliberately chose not to be regulated by a real regulator who can give any protection to the customers. Even I know this.

@PrestonRiver

why do you think only American and EU regulators are valid?

Franca did not say that.

Are you an affiliate or an introducing broker for a high-leverage broker, @PrestonRiver ?

[Franca_Bridge]

@NeitherFishNorFowl

Franca did not say that.

Lol, he’s on my “ignore” list, so I had to log out, even to be able to read what you’d quoted from him, in your post!

You’re right: I didn’t say that. The Australian regulator ASIC is also a very good one that can protect customers.

Most of the others not mentioned above are fake regulators paid for collectively by the brokers they pretend to “regulate”, so customers can never win a dispute against them. Especially the Caribbean and Pacific island ones.

In some cases (Vanuatu, St. Vincent +Grenadines and others) even corrupt governments are getting back-handers from those “regulators” rather than paying for them.

@NeitherFishNorFowl

Are you an affiliate or an introducing broker for a high-leverage broker

I make no accusations at all, but that’s obviously a common reason in trading forums for people to try to defend fake regulators and the brokers who have decided to avoid real ones. On the other hand, some people can just be “misinformed” or “mistaken”, and to be fair the CFD industry is pretty much set up to produce that result!