Forex trading education - Should You Leverage?
Later on you will learn whether it is worthwhile to leverage your transactions and by how much. But one must always remember, for whoever wants to leverage - the option is always available, but its risky.
When there is a leverage of 300 times you can perform a transaction of 300,000 Euros as well, and if the price rose by 100 pips, you can even earn 300% return in one day. But if the exchange rate decreases by 33 pips, you have lost your whole investment.
Why do the firms allow us to leverage?
The answer is simple: it is preferable for the them that we perform a transaction of one million Euros, rather than a transaction of 10,000 Euros, in this way the broker earns a omission of 300 USD and not 3 USD.
Later on you will learn what your interest is as traders, and why you shouldn't be tempted to leverage transactions.
Whats Next?
* Stop-loss order
Or go back to the education index
When there is a leverage of 300 times you can perform a transaction of 300,000 Euros as well, and if the price rose by 100 pips, you can even earn 300% return in one day. But if the exchange rate decreases by 33 pips, you have lost your whole investment.
Why do the firms allow us to leverage?
The answer is simple: it is preferable for the them that we perform a transaction of one million Euros, rather than a transaction of 10,000 Euros, in this way the broker earns a omission of 300 USD and not 3 USD.
Later on you will learn what your interest is as traders, and why you shouldn't be tempted to leverage transactions.
Whats Next?
* Stop-loss order
Or go back to the education index
