When Trading Forex What Is The Difference In Cutting Leverage In Half And Cutting Order Size In Half?
June 29th, 2009 | by Frenday |Is there a difference between the two?
Profit/loss will be cut by the same amount either way, correct?
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3 Responses to “When Trading Forex What Is The Difference In Cutting Leverage In Half And Cutting Order Size In Half?”
By Yarcofin on Jun 29, 2009 | Reply
Cutting leverage means that you will be wielding less power with every dollar you invest.
If you invest $10,000 at 100-to-1 leverage, you are essentially controlling $1,000,000 worth of assets.
At 50-to-1 leverage, your $10,000 is only controlling $500,000 worth of assets.
Both ways, the most you can lose is your initial $10,000.
Cutting order size means you are investing less at a time.
Say you buy one $500 lot instead of 2 $1,000 lots.
That’s my understanding, anyway.
You are better off cutting lot size than leverage, I think.
By Nashroll . on Jun 29, 2009 | Reply
First of all you should understand what is the leverage and order means. It’s 2 different things.
leverage: if your leverage is 1:100, that’s mean you can trade 100 000 if you have 100 in hand
order: the actual money involved is depends on your leverage and money in account.
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