What is the pros and cons of using high leverage?

[kora_trader]

hello. Can you guys give me your opinion about the ideal leverage?
which leverage do you often use? what is the pros and cons of using high leverage?
since i'm going to use small account with high leverage!

 

[somenews]

I often use 1:50, it's the moderate leverage to me, not too high but not too low

 

[Enivid]

The leverage is set to 1:100 on one broker and 1:400 on another broker I trade with. However, I rarely use full leverage there. Since my risk tolerance is about 1% per trade and I rarely hold more than two positions simultaneously, my effective leverage is often just 1:2-1:5.

 

[radex78]

Seems from many tarder here prefer use low leverage and comfortable using low leverage it will prevent from over trade I think, I am only use small capital usually might still not too much seriously investing my money, often use high leverage 1:500

 

[MarkTrader]

I believe with high leverage the risk of getting a margin call is likely more probable.What do you guys think?

 

[Enivid]

Sure, the higher the leverage the more difficult it is to avoid a margin call.

 

[MartinBa]

1:200 or 1:100 with balance from $5k better solve for me. Low risk to lose all funds.

 

[Maverick]

As i understand it with leverage you COULD lose more than you started with.

1:1 you can only lose your own money - 90% if you are saved by Margin call

 

[inggo]

yeah thats about it, its a double edged sword , one can earn a lot from high leverage at the same time, lose a lot faster from higher leverage, im use a leverage of 1:500 on a small account, which might look risky but thats what i got used to trading lmfx, but one can always aquire lower leverage if needed especially for larger investment, lessens the risks

 

[Maverick]

You can still make a lot of money with 1:1 . . . "Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it" - Albert Einstein

 

[fxapex]

See basically when you use leverages your investment gets higher according to the leverage given and you can now have large capital to invest, but at the same time if you loose using high leverage you have to repent in multiples.

 

[jellyeb]

See basically when you use leverages your investment gets higher according to the leverage given and you can now have large capital to invest, but at the same time if you loose using high leverage you have to repent in multiples.

That's the main hiccup with leverage in trading - losing is much easier than earn (though there is 50/50 price will go up and down). I think its because newbies like to hold losing positions too much and close profitable ones too early.

 

[ijak8510]

hello. Can you guys give me your opinion about the ideal leverage?
which leverage do you often use? what is the pros and cons of using high leverage?
since i'm going to use small account with high leverage!

when you are wrong with a market forecast and leverage starts to work against you.,you can read it more here

Leverage is double edge sword. it can be useful in the right hand, but can be dangerous in the wrong hand
however i think , what is more impotant than leverage, is your risk management

 

[RichardTrade]

Yes,I think high leverage only increases your greed which led to losses and disappointment.

 

[inggo]

most my trades at hotforex are on a 1:500 leverage, i just got used to trading high with smaller lots, but on that i can say yes the higher the leverage your profit can go high but at the same time the loses can be raelly big

 

[somenews]

That's the main hiccup with leverage in trading - losing is much easier than earn (though there is 50/50 price will go up and down). I think its because newbies like to hold losing positions too much and close profitable ones too early.

That's exactly what I'm facing. when the trend goes like what I want, i instantly close my orders b/c this time I think I'm just a scalper, but when I'm losing, I keep the order and wait for the trend reversals. :||

 

[Imocha]

I use 1:50

 

[kora_trader]

The leverage is set to 1:100 on one broker and 1:400 on another broker I trade with. However, I rarely use full leverage there. Since my risk tolerance is about 1% per trade and I rarely hold more than two positions simultaneously, my effective leverage is often just 1:2-1:5.

the leverage is 1:2 - 1:5, I have to say I dont know any broker offers that low leverage.
it seems like you have to go with big deposit. Is it a risky strategy?

 

[Enivid]

the leverage is 1:2 - 1:5, I have to say I dont know any broker offers that low leverage.

Many brokers offer low leverage, but as I have said, my accounts have 1:100 and 1:400 leverage. I just don't use it and effectively trade with 1:2-1:5 leverage.

it seems like you have to go with big deposit.

No, I do not have to go with a big deposit.

Is it a risky strategy?

No, the strategy is not risky. I rarely risk more than 1% of deposit per trade.

 

[tammy]

I'm trading demo and went with leverage of 1:300
b.c I dont know how to change it, so i have to continute to trade with that high leverage.
next time, i'll use lower leverage to suit my safety strategy.