Why is leverage a double-bladed knife ?

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Leverage is a very efficient weapon to succeed in the world of forex.

Everyone use leverage to trade forex.

Large leverage let you use dynamic strategies.

If leverage is small, we can manage our balances well.

Individually, I like big leverage.

What do you think about leverage ?

 

Big leverage is the shortest way to lose your account. No serious trading can happen with big leverage

 

Simple: As much as it magnifies your wins when things are moving on well, it also magnifies your losses when your are on the negative.

 

I agree with you.

thanks to your kind mention.

 

thanks.

negative move is resulted to "all out", in other words "loss cut".

But if you have a small money you can make big money to use large leverage efficiently.

 

Don't forget that you are bounded from the downside : you can not go bellow zero. And with big leverage you are going to go to zero in no time at all (not just the possibility to gain rises with big leverage - but the risk too, and since you have the lower limit, the risk is proportionally greater than the gain probability - the smaller the account the more it is probable that it will hit 0). Big leverage is not intended to be used by traders. It is intended to draw small investors to lose what they have and to draw gamblers into the game. Again : trading has nothing in common with big leverage

 

Nobody should trade leverage > 1:100. That is a suicide

 

thanks to your kind and wise mention.

I agree with you.

 

exellent opinion!

I accept your concept.

But if you have under $100 in your account, big leverage is a bless to make big money.

 
Antoanete Grace:
exellent opinion!

I accept your concept.

But if you have under $100 in your account, big leverage is a bless to make big money.

Big leverage is never a bless. And with that kind of account and with a big leverage nobody will ever make big money.

 

I agree with totally.

thanks to your exellent opinion!

But I think large leverage let us use various strategies.

If you have a good condition, I think you can use efficiently the larger leverage

and the result is gaining a brilliant profit.

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