Hi, I would like to know , on what account size can you use the leverage ratio of 500:1 or 400:1. Thank you
What do you mean ??? on what account size
it goes like this
if your broker offers 500:1 Leverage, you can create an account with 500:1 Levearage
Having Higher leverage will cause you to take on more risk, but have a lower Margin (Assuming we are keeping the trading instrument the same in this example), Apples vs Apples so to speak
now if your broker offers a minimum deposit (Which HONESTLY, you should never take) of $25
then you can open a 500:1 Leverage account with that amount
on the flip side, you can do the same with a $5,000 Account
so what is your question…
is it, WHAT IS THE MINIMUM AMOUNT YOU SHOULD HAVE IN YOUR ACCOUNT BALANCE IF YOU ARE GOING TO USE 500:1 LEVERAGE ?
ANSWER : We can’t answer this until we know the instrument you are trading
because , the instrument will determine the NOMINAL MARGIN and Lot size needs to also be considered
if we ignore this point and try to answer your question directly,
it would mean the difference between you blowing out your account or not
it seriously is not a point you want to overlook
so , does this help at all
On any account size accepted by a broker offering that crazy leverage.
It’s extremely inadvisable, though. Brokers offering that kind of insane leverage are doing so because they know that the customers who find it attractive are all going to lose their money to the broker.
Be aware that these aren’t really “brokers”. They’re counterparties who make their living by holding the other sides of the trade of hopeful customers who are naive and inexperienced enough to think that leverage like that is a good thing,
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Thank you Martin, that really helps, really got to do thorough study on leverage and lot sizes
You gave me something to make a research on, thanks
Retail Prime Accounts are only 1:200 Leverage maybe 1:300 MAX
Institutional accounts are 1:10 leverage usually maybe 1:50 but they have the big bucks to Start with
ÂŁ1000 Staring capital 1:500 lev = ÂŁ500.000 worth of currency to play with
ÂŁ500 with 1:500 = ÂŁ250.000
1 LOT = ÂŁ100.000 so 0.10 LOT = ÂŁ10.000 Approx 0.01 LOT = ÂŁ1000 OF Your leveraged money
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You’re welcome mate
that was what i was hoping for.
I see; few brokers are offering 1:1000 even 1:2000 leverage! No way, with this kind of crazy leverage; definitely they are the scam brokers!
Two things, Nomy.
Firstly, understand that I’m trying to help you, not to criticise you.
Secondly, the two questions you’ve asked so far (one about 500/1 leverage and the other about making $50 profit per day from a $300 account!!) both illustrate that you have a long learning curve ahead of you before trying to trade other than on demo. At the moment, you’re a good victim for a market-maker “broker” and nothing else. Your plans are completely unrealistic.
Have you worked through the educational pages here?
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Yeah would not like to find that out the hard way though.
@LukasVisser is correct you have much to learn, but everyone has to start somewhere think of where you are Now as the very start…
Keep up the studies
I use 1:500 at JAFX. Never had any issues and been with them 9 months now.
1:500 seems to be the most popular with new readers me too.
From all trading interments leverage contains huge risk and we can fall a great trouble by using leverage if there is no trading plan with risk management. Allen, 1:500 is much leverage for newcomers to manage risk accurately. As a newbie I was comfortable with 1:100 in demo and kicked off live account with 1:50. It was so comfortable for avoiding unfortunate risk and losses.