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Trading basics

What is leverage and how should I use it?

Borrowed buying power. Magnifies both gains and losses. The cap is FXNX's ceiling, not a suggestion.

3 min readTrading basics

Leverage lets you control a position larger than your account balance. At 1:500 leverage, $1,000 of margin controls $500,000 of notional exposure.

Pros: capital efficiency — the same dollar amount controls more position.

Cons: losses scale at the same rate as gains. A 1% adverse move on a 1:500 position wipes out half the account.

Practical guidance: most professional traders use far less leverage than the broker offers. 1:20 to 1:50 is common. 1:500 is the cap, not the recommended setting.

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MISA · BFX2025082
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CFDs carry risk. Capital at risk. MISA regulated. 18+ · MISA License BFX2025082 · Saint Lucia 2025-00128