Oanda demo account leverage question

I’m looking to go with real money next week, but before I do, I need to know something about their leverage.

In my demo, it says I’ve used over $120 in margin so far. I never set my margin to begin with. I called Oanda, and they said that the default setting is 10:1, and I can change it anytime, but no lower than 10:1. Strange. I’ve been betting mini lots of $10,000 fake dollars every time, and my pip value has been $1 every time as well. Where is this phantom margin coming into play??

I need some clarity here, that my Oanda rep was unable to provide.

Well, I do not care about my margin or my broker leverage. I use the same lotsize as you like 10k and 1 usd per pip often. If you calculate your risk per trade as no more than letz say 5% of you equity, then you will not run into margin issues as long as your account doesn’t drop close to zero. So, lets say you put in 1k of money, then you could risk 50 usd per trade or 50 pips. Easy! Hope that helps.

I am on Oanda too and opened a demo account on MT4 and the most it lets me get is .05 cents per pip. I started the demo with $1000 because this is what I eventually will deposit. I figured I could at least do $1 a pip, any reason why it won’t let me go more that .05 cents?

Right, and that’s my question. I’m not using any margin at all. I’m wagering $10,000 of the $100,000 in play money they give you to start. I make $1 of profit/loss per pip. And my account still says I’ve used $127 of margin, and the rep on the phone said that 10:1 leverage was the default, and I’ve been using that the whole time.

None of this makes sense!!! Please help!!

i hope i explained this correctly. your term for margin should mean the amount used to buy the pair eg. GBP/USD. You use a margin of your $10,000 to buy say 0.1 lot which means you’ve used 0.1 x $10,000 x 10 % = $ 100 per pip.

0.1 being the lot size.
$10,000 being initial deposit amount usable.
10% is 1 : 10 leverage. OANDA minimum leverage is 1:50 which is 2 %.

i hope that clarifies your question.

The account leverage setting is just something which determines your required margin, which is a % of the value of your position. It does not directly effect the actual margin you employ (unless you try to exceed it, of course). If just tells you the minimum you must have in your account balance to have the trade(s) you have on open.

Think I got it now. And yes, I did play GBP/USD, so that may be where that “margin used” number came in. Cool, thanks everyone. If I get confused on it again (likely), I’ll just ask again.