When traders think of how to make fast gains from Forex trading there is one key trading tool that springs to mind - Leverage!
Trading with leverage is one of the most efficient and effective ways to open larger positions with less capital. Traditionally, traders would not have access to leverage and would have to come up with the whole stock value in order to trade - making this practice an elitist one. Nowadays, thanks to online trading platforms with high leverage on offer, more and more would-be traders can get involved in the markets.
Leverage allows a trader to place high volume trades using little capital as leverage is, in effect, a loan from a trading platform.
For example, without the use of leverage to place a trade worth $100,000 with 1:1 leverage, the investor would be putting up the whole $100,000
Thanks to leverage, we can work out that a trader using 1:500 leverage for a Forex pair carrying a volume worth $100,000 ould open a buy or sell position with $200.00.
$100,000 (volume) / 500 (leverage 1:500) = $200.00
Looking at the numbers, it's clear to see how much leverage has transformed the trading sphere in recent years in terms of accessibility.
If you are serious about breaking into the world of Forex or simply looking for a new broker, then there are some key KPI’s one can consider when choosing the best possible broker for you to boost your earning potential.
Look for value first and foremost. You do not want to be tied down to an account where you must pay ongoing costs for average leverage. Look out for free to join sites that offer high leverage.
Consider the platform that is used within the site. Sites that back into the MT4 and MT5 platforms have some of the best indicators on there for you to monitor your trades closely and carefully.
Account finance is important. Check what minimum deposits are available so you can deposit what you feel comfortable with. Also, consider the deposit and withdrawal methods and if these are the best they can be for you. Bitcoin is one of the most fluid methods in getting funds in and out of an account in super quick time.
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The demo account has identical conditions to the live account for you to develop a trading strategy before going live.
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