Tuesday, November 15, 2011

Disadvantage of Leverage

Due to leverage when you purchased large amount with minimum margin for example if you have $500 balance in your trading account and you purchased 10k Euro lot with $140 margin now your used margin is $140 and your useable margin is $360 if you don’t place a stop order for your trader in case rate is moving against you when your loss reach at $360 then you receive a margin call and broker will close your trade in loss.

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