Leverage and Margin
Leverage and Margin
Leverage amplifies your market exposure. Understand how it works and the risks involved.
What is Leverage?
With x10 leverage, $1,000 gives you $10,000 exposure. Both profits and losses are amplified.
Profit Example
$1,000 x10 leverage = $10,000 exposure
Asset rises 5% → Profit: $500 (50% ROI)
Loss Example
$1,000 x10 leverage = $10,000 exposure
Asset drops 5% → Loss: $500 (50% loss)
What is Margin?
Margin is the collateral to open a leveraged position. x10 leverage = 10% margin ($1,000 for $10,000 position).
Max Leverage by Asset (ESMA/Retail)
| Asset | Leverage | Margin |
|---|---|---|
| Major Forex | x30 | 3.33% |
| Minor Forex | x20 | 5% |
| Major Indices | x20 | 5% |
| Gold | x20 | 5% |
| Other Commodities | x10 | 10% |
| Stocks / ETFs | x5 | 20% |
| Crypto CFDs | x2 | 50% |
Margin Call & Close-Out
Margin Call: Equity below 50% of required margin — add funds or close positions.
Close-Out: Positions auto-closed to protect from negative balance.
Risk Management
- Always use stop-loss on leveraged positions
- Risk max 1-2% of account per trade
- Start with lower leverage while learning
- Practice on demo before real money
Risk Warning: CFDs are complex instruments with high risk of losing money due to leverage. 51% of retail investor accounts lose money when trading CFDs with this provider.