Understanding margin and leverage
Take a position by depositing just a fraction of the full value of your trade.
Margin
Margin trading allows you to leverage the funds in your account to potentially generate larger profits by depositing just a fraction of the full value of your trade. This means that you can enter into positions larger than your account balance. The downside, however, is that you can also incur significant losses if the trade moves against you.
Margin is a good faith deposit or performance bond. In leveraged trading, the margin amount is held in deposit by us, your platform provider, while the trade is open. Although there is no minimum margin deposit required to open a trading account with EUTRADE, the margin available in your account will determine the size of the positions you can open.
Remember, when trading on margin, both profit and loss can be magnified. Carefully consider your financial objectives, level of experience and appetite for risk before you begin trading on leverage.
Leverage
Available leverage in EUTRADE Global Markets is 200:1 or lower.
The leverage will also vary depending on the margin tier applicable. All of our instruments have margin tiers, which generally means that the larger the position you hold over a certain size, the higher the applicable margin rate. Different margin rates may apply depending on the size of your position; as your position size increases, so does the incremental margin rate on a tiered basis.
Whilst EUTRADE offers different instruments that have different margin requirements, you have full control of the trade size you would like to open and can manage your risk by adjusting your trade size accordingly. The larger the amount of your available funds that you use in a trade, the greater the risk. Experienced traders would not risk all of their funds on any single trade.
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