What is Leverage?

In trading of leveraged financial instruments, a smaller margin deposit can control a much larger total contract value. Leverage gives you the ability to make large profits, and at the same time keep risk capital to a minimum.
For example, if you choose 1:100 leverage, which means that a 1000 margin deposit would enable you to execute a buy or sell order of 100,000 worth (1 Lot) of currency. Similarly, with 5000 deposit, you could trade with 500,000 (5 Lots) and so on.
But high leverage, without proper risk management, can lead to increased losses as well as very substantial gains as it magnifies the outcome of the position either way.

Please consider carefully your experience and risk appetite when choosing your leverage.

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