The function of the Margin and Leverage it can make you do not need with 10,000 EUROS to buy 10,000 EUROS, but enough with the capital guarantee amounting to approximately 100 EURO course then you can already trade at a number of 10,000 EUROS
An example of Sense: you want to Transact in the currencies USD/JPY as much as $ 10,000. In modern day Forex Trading you need not need capital as much as $ 10,000 to be able to Transact in that amount. Because in this modern type of Forex you can borrow to market or broker as much as $ 10,000 to be used in trade, and for the loan of that you provide enough guarantees of as much as $ 100 from your capital to them. So it is like you borrow as much money as $ 10,000 but you simply menjaminkan your assets an amount of $ 100. And your risk is only for $ 100.
And when your order is later completed diclose the margin (guarantee) will be refunded to your account your portfolio as a whole again.
Note: the amount of the loan (in the example above that $ 10,000) referred to by the term Contract Size or Quantity
In general given leverage in Forex Trading is a Modern 1: 100 or in the sense of requiring only 1% margin (collateral). So if you want to buy the USDollar against Japan Yen (USD/JPY) as much as $ 10,000 then you provide enough margin (collateral) of 1% from the $ 10,000, $ 100. And you can trade like as if you bought a bank note Exchange with a capital of $ 10,000 in a bank or money changer, when actually you can simply issue a capital guarantee for $ 100 only.
The function of such as 1: 100 leverage you can increase the strength of your transaction to about 100 x lipatnya, so such margin with a capital of $ 200 then you can trade in the amount of $ 200 x 100 = $ 20,000
What if I want to trade on multiples of more than 100 x?
You can choose a higher leverage of 1: 200 or above it, which is where the leverage that the higher the warranty marginnya also getting smaller (see examples below)
How to calculate margins with leverage: Example-1: 100 leverage it means (1/100) x 100% = 1%-leverage 1: 200 then it means (1/200) x 100% = 0.5% – leverage 1: 400 it means (1/400) x 100% = 0.25%
0 Comments