Does leverage matter if you're always trading the same size?



I know the concept of leverage, but I've always wondered if it matters in order to lower the risk of, say, an Expert Advisor. Let me give you an example: let's imagine I have an EA which always follows the same strategy, which is opening 3 positions, 0.01 lots, 0.02 and 0.03. That's the EA logic, and that's what the EA will always do, as long as we have enough funds. Now, in this example, does it matter if my account leverage is 1:500 or 1:100? I guess it would matter if I was planning on trading 10 lots, but does it have an impact on an EA risk, provided that the EA always trades the same size?

I don't know if my question makes sense? Thanks in advance.


"If you're always trading the same size," you are not controlling your risk.

Risk depends on your initial stop loss, lot size, and the value of the symbol. It does not depend on margin and leverage. No SL means you have infinite risk (on leveraged symbols). Never risk more than a small percentage of your trading funds, certainly less than 2% per trade, 6% total.

  1. You place the stop where it needs to be — where the reason for the trade is no longer valid. E.g. trading a support bounce, the stop goes below the support.

  2. AccountBalance * percent/100 = RISK = OrderLots * (|OrderOpenPrice - OrderStopLoss| * DeltaPerLot + CommissionPerLot) (Note OOP-OSL includes the spread, and DeltaPerLot is usually around $10/PIP, but it takes account of the exchange rates of the pair vs. your account currency.)

  3. Do NOT use TickValue by itself - DeltaPerLot and verify that MODE_TICKVALUE is returning a value in your deposit currency, as promised by the documentation, or whether it is returning a value in the instrument's base currency.
              MODE_TICKVALUE is not reliable on non-fx instruments with many brokers - MQL4 programming forum (2017)
              Is there an universal solution for Tick value? - Currency Pairs - General - MQL5 programming forum (2018)
              Lot value calculation off by a factor of 100 - MQL5 programming forum (2019)

  4. You must normalize lots properly and check against min and max.

  5. You must also check Free Margin to avoid stop out

  6. For MT5, see 'Money Fixed Risk' - MQL5 Code Base (2017)

Most pairs are worth about $10 per PIP. A $5 risk with a (very small) 5 PIP SL is $5/$10/5 or 0.1 Lots maximum.