Aurix Exchange

Is trading 500:1 leverage safe?

.Alphonsa

Member
I'm currently trading with a leverage of 1:200, and so far, I was able to make consistent profit and manage certain losses. Should I start trading with 500:1 leverage since there is a chance of higher profits, or would I end blowing up my account?
 

Justinjoez

New member
If you can trade with 500:1 and manage the loss then you can take the risk and make a few trade to experience the leverage, because the profit earned is higher than the 1:200.
 

Frank.lin

New member
Since you have already traded using 200:1 leverage, you are already aware of the consequences and risks involved in trading with higher leverage; hence it would not make much difference for you to trade using 500:1 leverage.
 

AustinRos

New member
It is pretty high and risky to trade with 500:1 leverage. Certain jurisdictions do not allow it due to the increased risk of losing one's capital.
 
The fact that 500:1 is high and many traders prefer to trade below it because the risk is also high.

If you are a good trader with money management skills and have made a consistent profit, you can give it a shot once and gain experience.
 

natalie2

Member
I believe thats too much of a leverage and quite risky. I dont use anything more than a 30x, Like to play it safe.
 

Judey

New member
If you are a beginner, you should know that trading with high leverage is a risk, but it would not seem highly risky for an experienced trader because of the skills and strategy used when trading with 500:1 leverage.
 

Robbe.Dupont

New member
From my perspective, it is risky to trade with high leverages without any backup plan because there is an advantage and disadvantage in trading with 500:1.

The profit earned using high leverage is really good, but a loss could also be higher, some traders have even burned their account using such high leverages.
 

Arla69

Well-known member
I'm currently trading with a leverage of 1:200, and so far, I was able to make consistent profit and manage certain losses. Should I start trading with 500:1 leverage since there is a chance of higher profits, or would I end blowing up my account?
any leverage is safe as long as you keep your risk per trade under 3% per trade and win ratio over 80%
 

LoganP

New member
If you are a good trader using a proper strategy with money management skills, it is also important to use a reliable broker with such high leverage.

I use FP Markets because they offer leverage up to 1:500, and they are one of the oldest broker active for over a decade.
 
If you are well aware of the risks and have the right strategies or money management skills, then trading with 500:1 is safe, but it is also important that you trade with a good broker like FP Markets or CMC.
 

Xmind

Member
Having higher leverage is better in a case when you want to diversify your small trading capital or trading higher time frames with larger stop loss. But in any case, the sum of all open positions size should not be higher than 1- max5% of your trading capital-balance.
i.e.
1. balance 100usd leverage 1:500 = 50000 USD leveraged trading capital. 5% = 2500usd =1 position with stop loss = 2500usd or 5 position with SL=500USD in reality 5usd of your capital at risk
2. balance 100usd leverage 1:30 = 3000 USD leveraged trading capital. 5% = 150 USD / 1 position with SL= of only 150 USD in reality 5 usd of your capital at risk so the stop loss may be too narrow for use in higher time frames and you are limited to open less position at the same time if you want to diversify your trading with the same real risk.
Al that if we use the same type of broker account with the same minimum size position.

What we should take into consideration is how small is the minimal position of your broker. So the solution for small leverage is to use micro account type instead of mini then is not so big a difference. I think mini = 0.01 and micro use 0.001 or less and it will allow you diversification and other benefits.
 

Aurix Exchange
Top