leverage

Using borrowed money so a small amount of your own controls a much bigger trade. Wins and losses both get bigger.

The fuller meaning

Controlling a position larger than the deposit: leverage = position value ÷ margin, so 1,000 at 10x controls 10,000. Gains and losses scale with it, and a move of about 10% against a 10x position can wipe out the deposit. Traders size from the stop first, so leverage only sets how much margin is tied up.

leverage.

leverage

The fuller meaning

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