Simple Leverage Question

Beginner Questions
1

Hello Folks :+1:

Simple question

Trade 1 account 1000$ leverage 1:500
Buy 0.01 EUR/USD close the trade at 50 pips loss , how much loss in $ ?

Trader 2 account 1000$ leverage 1:300
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips loss, how much loss in $ ?

Trader 3 account 1000$ leverage 1:100
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips loss, how much loss in $ ?

Trader 4 account 1000$ leverage 1:50
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips loss, how much loss in $ ?

Trader 5 account 1000$ leverage 1:1
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips loss, how much loss in $ ?

2

On each trade you will have 0.1$ of loss for each pip.

For 50 pips you will have $5 loss.

Read here for more information.

3

Thanx for the reply @GetKnowTrading,
so you saying all traders will lose 5$ regardless of leverage?

1 Like
4

You are welcome.

Leverage affects the maximum lot size you can open.
For example, on a small leverage you would not be able to open large lot site, like 1.0 which is standard lot.

Leverage also affects margin and free margin.

1 Like
5

Buy 0.01 EUR/USD close the trade at 50 pips=loss 5$

Trader 2 account 1000$ leverage 1:300
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips =loss 5$

Trader 3 account 1000$ leverage 1:100
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips =loss 5$

Trader 4 account 1000$ leverage 1:50
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips =loss 5$

Trader 5 account 1000$ leverage 1:1
Buy 0.01 EUR/USD 0.01 close the trade at 50 pips =loss 5$

From what i understand it’s only when i increase the lot size that leverage start making an impact

6

this is a smart beginner question. I was confused with leverage and what it was when I first started out. But, yea the leverage determines the maximum lot size you can use like what @GetKnowTrading said . And if you have a $1k account and close the trade at 50 pips on any pair then you would lose $5 for all pairs.

1 Like
7

leverage sounds simple in words , but when using high leverage then you can realize its a most dangerous thing in the world which can make you gainer and also a loser within very short time.

8

You should use a leverage calculator, or margin required calculator. There is also the pip value calculator. Google it, find and use it.

9

Indeed

So since leverage affect margin level% using the example below how much % margin level will be left when opening an 1 order of buy eur/usd 0.01 on each account?
Trade 1 account 1000$ leverage 1:500 = how much % margin level

Trader 2 account 1000$ leverage 1:300 = How much % margin level

Trader 3 account 1000$ leverage 1:100 = how much % margin level

Trader 4 account 1000$ leverage 1:50 = How much % margin level

Trader 5 account 1000$ leverage 1:1 == How much % margin level

10

Leverage affects the size of initial margin for position and not potential loss or profit.

11

its a good suggestion you are talking about. appreciate. thanks. but in general Forex traders like to use leverage with no calculate, as a result fall a great trouble above all when market moves at random.