How do I benefit from leveraging in FOREX?
For instance: 200:1 would this mean I pay say 300 dollars in good faith to play with 3,000? Let’s say that 3,000 makes money wouldn’t I just have to pay the money back anyway? Therefor left with a 1:1 ratio? I know it seems like a stupid question but I’m very new to investing and trading and I don’t see any value in leveraging can anyone help me to see the gold behind this strategy?
Does anyone use FXCM trading station II? I used that for my practice account, are there better ones out there
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200:1 = $1.00 investment is $200.00 leverage.
Thus $300.00 in this model is $60,000 leverage.
1:1 ratio is much less risky = no leverage.
I think that if you are not sure how leverage works or how the underline investment can be impacted then I would prob not be trading in a market that I don’t understand.
Never use 200:1 leverage in the FX market. You will (most likely) lose within a VERY short time. Most standard accounts use 100:1 leverage, which means that your $1000 is able to purchase $100,000 worth of FX crosses. However, you must maintain a margin balance to allow for your trade to be wrong. No remaining margin = liquidation of your position. Leverage allows you to make a lot of money with little capital, but it works with losses also. Volatile, that’s the word. FXCM is good, as is Forex.com. I have used both and they are very reputable, with solid interfaces. I prefer FXCM.
I would suggest you not use 200:1 you could lose all your money real quick.I use 50:1 and am happy with that.I use oanda for a broker.If you want to trade directly with the banks you would need something like EFX
you seem to still need to learn a lot about forex trading. little knowledge is very risky in this business. Forex is a very volatile market and is a very risky. you need to get the most information you can get and learn all you need to know before you try to get involve in it.
i recommend you visit this site and register to download a Free Forex Ebook to further your reading and whatever acquired knowledge you have. should you wish to really get head on, you can make an initial deposit of at least $100.00, which you can also use to trade later, and you will be provided a personal Account Service Manager (ASM) with whom you can talk live via phone, email or chat. you can then take this opportunity to ask everything you want to know about forex. being an expert forex trader himself, your ASM will be your best resource person and he will even trade along with you so that you will get to familiar yourself about how the real trade is done and give you the tips and tricks you need to know and do to achieve a profitable forex dealing. good luck.
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