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Investment
Leverage in Forex
Borrowing money from your broker to control a much larger position than your own cash allows.
Leverage is one of the biggest reasons people are attracted to forex, but it is also the biggest danger. Most brokers offer 30:1 to 500:1 depending on regulations. Professional traders use lower leverage to stay safe.
It's like using a small deposit to control a huge house — you only put down 1% but control 100% of the value.
Real world: With 100:1 leverage, £1,000 of your money lets you control £100,000 worth of currency. A 1% move in the market can double your money — or wipe out your entire account.
💡 Leverage is a double-edged sword — it magnifies profits and losses equally.