Leverage. Tips for beginners.

Every day, the Forex market involves with the opportunity to start currency speculators. Only on the foreign exchange market can trade with a minimum deposit to get real income. Numerous brokers, providing access to the market yayuschie forex for private traders are willing to provide their customers with the most attractive trading conditions. One of these conditions of the majority of brokers - margin trading, that is, the provision of loans for operations.
Naturally, for the efficient and cost-effective (cost effectiveness can be read on the website betafinance.ru) trade necessarily understand the basic concepts that you will encounter in future work.
The basic concept of this is just the leverage. Leverage - is the ratio of the amount allocated for the deposit and a debt. Leverage and financial leverage - is a tool of trade that occurs in margin trading. Today all Forex brokers offer the possibility of using debt (margin trading), which allows successful traders extract more profits from their trading operations. Usually, instead of using a pointer size of margin leverage, expressed in ratios. Leverage can have values ​​ranging from 1:1 to 1:500, depending on the broker. Each trader chooses personally for themselves the value of leverage, based on the trading strategy and the size of the deposit.
Now consider the principle of leverage. For example, with the account of $ 100, you can make transactions (buying and selling) for a total of 500 times as much - $ 50,000. In this case, your trading deposit of $ 100 is a guarantee. If trading exceeds the critical value of a loss-making, the broker has the right to force close your trading position and take a deposit (margin) as compensation for the loss. This situation is called the standard " margin call "- margin requirement. In the event that your speculative transaction will be profitable, thanks to leverage you get a profit of 500 times.
Consequently, using leverage, you considerably enlivened their speculative trading in the Forex market, while having a modest deposit. It should be noted that the margin trading is not only at times increases the possibility of significant profits, but also increases the risk of loss, respectively. So choose the value of leverage must be carefully and thoughtfully, it is important to coordinate with your trading strategy and principles of management of capital (money management).
How correctly to choose the leverage? It is quite clear that the greater the leverage, the greater the profit. But do not forget about the losses, as having a great leverage in proportion to the size of the loss increases. It is best to select the leverage to build on their trading strategies, and more precisely, on its style. Suitable for aggressive trading value of 1:500 or higher, for a more relaxed activity, you can choose a leverage of 1:100 or 1:200. But for strategic investments to choose the thresholds, from 1:2 to 1:10.
From the above it can be concluded that the leverage - it is a useful tool for any trader. For a beginner can master the margin trading characteristics of the Forex market with a minimum deposit and professional speculator - a good opportunity to increase their performance.