What is leverage?

[stardoom]

Leverage 1: 100 means that we only use our own capital 1 to buy-sell 100, for example, we will place an order of EUR and hold it at 1.3502 for 100 USD (ie, obtain 74.0631 EUR). We do not need 100. USD, we will use only 1 USD to exchange 74.0631 EUR to hold, which when we sell it back to 1.3552 or profit 0.0050 instead of profit only that will turn out that we will make a profit of 0.50 usd means we can make a profit. Gained 50% of the money we invested (we only down $ 1 to make a profit of $ 0.50).

But don't worry Whether we will have enough money or not when there is leverage like this, because when trading we will trade a lot, not more than 40% of the capital (but recommend 10%, so that there will be left to excuse). The trade is only $ 10 or 10% (but when ordering $ 10 is 1,000 units at Leverage 1: 100), the 10% used is used margin, when the price goes up or down, it will add or subtract at the remaining 90%. Also known as available margin, if we keep negative until all available, the system will cut the loss by automatically closing this order, that is, the broker will not give a loss on our behalf.

In a nutshell, we will be able to make a profit (loss) of approximately 1% per pip from our capital. (Other pairs may not reach 1%, some are more, such as EUR / GBP fall about 2%)

This means that with a capital of just $ 100 (3,400 baht), you will be able to make a profit of up to $ 1 (order 10,000 units) if you do 10 points per day, then $ 10 or 340 baht (approximately) or 10% per day.

And with a capital of just $ 1,000 (34,000 baht), we can make a profit of $ 10 per point (trade 100,000 units) .If we do 10 points per day, then $ 100 or 3,400 baht per day.

Or maybe you can start with just $ 1 (34 baht), which will get about 1 cent per point.

Can gradually accumulate Because there are people who made $ 5 from free funding to $ 1,000 in 3 months.

Just think about it, if only you could make 10% of your daily capital increase over 6 months (120 trading days), how much would it cost from just $ 5.

It's $ 463,545.34 or 15,765,541.60 baht, oh my god (can only do 5% of this idea, it's luxury).

Usually EUR / USD is not very strong, can do 20-30 points a day if it is some pairs such as GBP / JYP (nowadays I mainly play GBP / JYP because of the stimulation). Sleep (midnight) until the time when I wake up (7:30) or 250% of the funds I trade.


More leverage means less margin.

If we place an order for 1 lot (on mt4 it is equal to the trade Quantity = 100,000 unit at marketiva).

If leverage 1: 100 uses margin = $ 1,000, 1 pip is equal to $ 10.
With leverage 1: 200, margin = $ 500, 1 pip = $ 10.
If leverage 1: 500, margin = $ 200, 1 pip = $ 10.

Notice, I order the same amount of trade, 1 Lot (or Quantity = 100,000 unit at marketiva, which) and 1 pip, no matter how much leverage you use, it will be the same. But what is different is the margin used to decrease.

The advantage of greater leverage is that the lower margin may be negative. A little longer (If you are going to hold until completely erased)

But the disadvantage is If you look at using margin and still look at the fund management that we try to trade no more than 10% of the capital, the more leverage, such as increasing from 1: 100 to 1: 200, then we still trade at 10% margin. The difference is (if the equity is $ 10,000 traded with a margin of $ 1,000).

1: 100 requires an order to trade 1 lot (or 100,000 Quantity) to use a margin of $ 1,000 to get 1 pip = $ 10, which if -900 points will be cut loss.

But 1: 200 requires an order of 2 lots (or 200,000 Quantity) to use a margin of $ 1,000 to get 1 pip = $ 20, which if -450 points will be cut loss.
(Actually marketiva can order a maximum of 100,000, but e-mail can request support to increase to 200,000)

Which, if used correctly Even if we choose 1: 200, we should trade at 1 Lot (or 100,000 Quantity) as before in order to reduce the margin to $ 500, where 1 pip remains = $ 10 and will be cut loss at -950 pips (stretch Obtained 50 points from the use of 1: 100, which can only be subtracted 900 points)