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What is leveraged trading

Leveraged trading is also known as deposit trading.

Investors use a small amount of capital to invest several times the original amount, in order to expect to obtain a return of several times relative to the volatility of the investment target, of course, there is also the risk of loss.

Leveraged trading, as the name suggests, is the use of small amounts of money to invest several times the original amount, in the hope of earning a multiple of the volatility of the investment in the target, or loss.

Trading is an important way for investors to trade in the current market. Through this way of trading, investors have the opportunity to make big trades with small bets, and their trades are likely to be more successful. Therefore, investors should understand this way of trading.

Many investors hope can into the foreign exchange market and can get the trade benefits from such a volatile market, some investors hold fluky psychology but also want to own a small amount of money into the foreign exchange market, which can obtain trading profits, therefore, if investors want to be successful in foreign exchange trading,

They should know about leveraged forex trading.

Assuming gold is 1500/ oz and a 1 lot (100 oz) contract is worth about $150,000, you only need a margin of $1000 to trade a 1 lot of gold, with a leverage ratio of 1:150(i.e. 1000:150,000).

Leveraged trading is risky because margin (the small amount of money) does not rise or fall in proportion to the volatility of the underlying product.

For example, if you invest 5 yuan to buy the underlying asset of 100 yuan, if the asset increases by 5 yuan to 105 yuan, then your margin will become 5+5=10 yuan, that is, 5% increase will become 100% profit through leveraged trading, that is, 20 times leverage.

If your value goes up or down by $5 and you fall by $95, then your margin becomes 5-5=0, that is, a 5% decline becomes a 100% loss through leverage.

Risky leveraged trading is not for everyone.

But the attraction, beyond the leverage, is the temptation to go short.

Gold opened more than $30 higher and U.S. crude oil jumped 7 percent to start the week.

Please pay attention to the specific operation, the market is changing rapidly, investment needs to be cautious, the operation strategy is for reference only.