Leverage fixed or customizable?

I feel like such a noob asking this here, but is it possible to use a different ratio of leverage with different trades. Ex: I used 1:10 leverage for my 1st trade and want to use 1:8 for my next trade and so on. Can I do that? Or does it stay fixed?

The broker controls the leverage across your account, but you can change things up using your position sizing and specifically, changing lots traded.

It’s been discussed before, so have a read here:

The pip value and position size calculators here can help you with some of that too.

So what this means is that as I change the trade size the leverage ratio changes, but what I am confused about is whether in the same lot size, I can play around with leverage. Hope I am able to explain myself

When a broker says it is offering you 50x leverage, it means that its upper limit is 50. You can use 5,10, 50 however much, it is up to you.

Are you talking multiple trades under the same trading account?

Did you read this?

Your lot size or amount of lots traded will need to change. You not directly changing a leverage setting, but with positioning sizing, leverage can change.

I think you should join a trading course, trading with such half baked knowledge can be disastrous.

Leverage is like a loan that you take on your margin account. Maximum leverage will differ from broker to broker. Some like roboforex give up to 2000x while Vantage would give till 500.

If it’s like a bank loan are there any interest charges involved?

Leverage is offered to make trading easier for traders with small capital. If you are like me, with only $100 to trade, you can use 100:1 leverage to turn your trading capital into $10000. Trading profitably with $10000 will give you much bigger profits than $100.

Read ‘leveraged trading’ by Robert Carver. It will sort you out with your leverage related doubts. I had used this book for reference when I first started using leverage on fp markets, fxview. Helped me immensely.

Of course you can use as much leverage as you wish. Just because instaforex (my broker) is giving 2000:1 leverage does not mean that I am bound to use all of it. I have never used more than 50x, and that too far and between. I mostly use around 10:1.

Leverage is rightly called a double-edged sword. Be careful with it. If not used right, can drown you in losses.

I am like you. Even my brokers Fusion Markets and Fxview offer 500:1 but I seldom go above 30:1. Maybe with more experience I will start using more.

Good call! Trading without leverage is no fun!

The initial margin requirement of every broker is different. It also depends upon the size of the trade.The leverage however is dependent on how much of the trade size is increased based on the margin held by a broker. So you can use leverage based on that.

I think it is also a matter of the currency that is being traded. A broker might require a higher margin requirement as per the currency but do note that the lower the margin requirement is, the greater amount of leverage you can use on your trades.

I second that and I use about 50:1 leverage on my trades. I also try to be careful with it since leverage can very well work against me on some trades. I mostly trade GBP/USD and I try to keep my leverage low for this pair. Trading with IG and Fxview these days and there isn’t any limitation on the leverage with these as such.

Yeah things can get a bit risky with leverage at times.

It is kind of like a short term loan that your broker provides and you can control large positions even with a little capital.

Leverage simply alters the available margin you have to trade so eithre larger positions or more trades at the same lot size. There is no need to change this from trade to trade as it is an upper limit on margin available.