I have big plans for Trading AtoZ, although it will take some time to reach my desired goal. I wanted to share with you these
Tag: Leverage
It is vitally important that leverage is fully understood before anyone undertakes trading. Leverage has advantages and disadvantages and must be used with a great deal of caution.
Trading with leverage simply means that you can open a much larger position than you could if you were trading without leverage. When you trade with leverage your broker effectively lends you money to allow an increased position size. The amount they lend directly relates to the leverage ratio. So a leverage ratio of 20 to 1 means for every £1 of your money, your broker would lend you £20.
For a full description please read our page on leverage.