Leverage
Leverage — The ratio of your trading capital to the position size you can control — e.g. 1:30, 1:100, 1:500.
- Quick definition: The ratio of your trading capital to the position size you can control — e.g. 1:30, 1:100, 1:500.
- Category: Forex Basics
Full Definition
Leverage lets you control a larger position than your account balance. Retail forex brokers offer up to 1:500 in many jurisdictions; ESMA-regulated brokers cap retail at 1:30. Prop firms typically offer 1:100 effective leverage. Leverage amplifies both profit and loss — the same 1% market move can produce 30% account gain or 30% account loss depending on position size.
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