What is Leverage?

Leverage allows you to control a bigger position with smaller capital.

Example:

You have $100.

If you use 5x leverage, your position size becomes:

$100 × 5 = $500

So you are trading like you have $500, even though your margin is only $100.

This can increase your profit.

But it also increases your loss.

That is the part most beginners ignore.

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