Leverage in Gold Trading
Types of Leverage in Gold Trading
Leverage Definition - Leverage Meaning - 100:1 leverage ratio. This is the leverage option in gold trading that is also used by experienced traders.
For $1000 Trading Account Equity
With 1:100 leverage ratio when you open a account with $1000 you will have capital of $100,000 to open trades with - with 1:100 leverage it means your online broker gives you $100 dollars for each 1 dollar that you have in your trading account. Therefore, if you have $1000 - 1000*1:100 Leverage is equal to 100,000 that you can transact with.
In Gold with $100 you can control $10,000 dollars trading capital to trade with after deploying leverage option of 1:100
For $500 Trading Account Equity
With 1:100 leverage ratio when you open an account with $500 you will have capital of $50,000 to open trades with - with 1:100 leverage it means your online broker gives you $100 dollars for each 1 dollar that you have in your trading account. Hence, if you have $1000 dollars - 1000*1:100 Leverage is equivalent to 100,000 which you can transact with.
In Gold with $1000 dollars you can control $100,000 dollars capital to trade with after applying leverage option of 1:100
For $1,000 Dollars Account Equity
With 1:100 leverage when you open a account with $1,000 you will have capital of $100,000 to open trades with - with 1:100 leverage option it means your broker gives you $100 dollars for each dollar that you have in your trading account. Hence, if you have $1,000 - 1,000*1:100 Leverage is equal to 100,000 which you can transact with.
In Gold with $500 dollars you can control $100,000 dollars capital to trade with after deploying leverage option of 1:100
Leverage Definition - Leverage Meaning - 100:1 Leverage ratio
For $2000 Dollars Trading Account Equity
With 1:100 leverage ratio when you open an account with $2000 you will have capital of $200,000 to open trades with - with 1:100 leverage option it means your broker gives you $100 dollars for each dollar that you have in your trading account. Hence, if you have $2000 dollars - 2000*1:100 Leverage is equivalent to 200,000 which you can transact with.
In Gold with $2000 you can control $200,000 trading capital to trade with after deploying leverage option of 1:100
Types of Leverage in Trade - Types of Leverage Guide
The more leverage you use greater the profits or losses
less leverage you use lesser the trading profit or loss
It's hence better to use less leverage so as to reduce risk involved. The higher the leverage option used the higher the risk. This is one of the leverage guide-lines not to trade with more than 5:1 leverage ratio.
In money management guide-lines: It is always advisable to stay below 10:1 leverage option which is still high, most professional traders use 2:1 leverage ratio meaning they trade only 2 percent of their Trading Account.
To Learn More about Leverage Strategies - Read the Leverage Meaning Below:
Gold Leverage Strategies - Types of Leverage in Trade - Types of Leverage Guide
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