what is leverage?

Leverage, otherwise known as risk level, is a temporary loan given to the trader by the broker. It enables you, as the trader, to open a trade of a larger size with a smaller amount of invested capital. Leverage is presented in the form of a multiplier that shows how much more than the invested amount a position is worth.

The best way to understand leverage is through an example of how it affects your profit or loss potential. If you trade with no leverage at all and invest $1,000, for every 1% move in the market you can gain or lose $10, which equals 1% of $1,000.

In comparison, if you were to invest the same $1,000 and trade using x10 leverage, the dollar value of your position would be equal to $10,000.

1% of $10,000 equals $100, so for every 1% move in the market you can gain or lose $100.

When opening a trade, you can decide if you wish to use leverage or not. Different instruments have different maximum leverage amounts, in accordance with applicable law.

Please note that the use of leverage carries with it a higher degree of risk because leverage augments both gains and losses. If you use leverage on a trade and the market moves against you, your loss per pip will be greater than if leverage had not been applied.

saint-vincent-and-the-grenadines-flag-image-free-d

Monyxa.com is owned and operated by Monyxa Ltd, Griffith Corporate Centre, Suite 305, Kingstown, Beachmont Kingstown, VC0120, St. Vincent & Grenadines, registration number 26054BC2020 as a licensed financial broker.

the-united-kingdom-flag-image-free-download

Monyxa Ltd (UK), located at 20-22 Wenlock Road, London, N1 7GU, registered by Companies House under number 12822563 is a fund management, security and commodity dealer and financial market administrator in the UK.

uae

Monyxa DMCC (UAE) located at Fortune Tower, Office 2106, Cluster C, Jumeirah Lake Towers, Dubai, UAE registered under number DMCC-792010 is a marketing company and call center provider for the Monyxa Ltd, for the Middle East.

IMPORTANT NOTICE: CFD’s are very complex instruments and come with a high risk of losing money due to leverage. It’s been proven that nearly 80% of all investors loose money when trading the CFD’s. You should wisely consider your understanding of CFDs and how they work and if you are willing to take the high risk of losing your funds. Please consider seeking a professional advice from an independent and licensed financial advisor to ensure that you have the relevant experience, knowledge and the risk taking appetite that suits you for trading. Monyxa shall have any liability under no circumstances to any person or entity for any kind of loss or damage resulting from, caused by or related to any CFD’s or any other trading transactions done at our platform. Most importantly, do not invest the capital that you cannot afford to loose. There are risks associated with on-line trading systems including, but not limited to, software and hardware failure, and Internet disconnection. Monyxa shall not be responsible under any circumstances  for communication failures, distortions or delays when trading via the Internet.

Copyright © 2013 – 2021 Monyxa – Your Trading Platform! All rights reserved.