Leverage allows traders to open larger positions than their account balance would normally permit. It’s a powerful tool that can amplify both potential profits and potential losses.
How Does Leverage Work? (More details)
How Does Leverage Work? (More details)
Leverage is expressed as a ratio (e.g., 100:1, 500:1, or 30:1) and determines how much capital you can control compared to your own funds.
For example:
With 100:1 leverage, you can control a $100,000 position with just $1,000 of your own capital.
With 500:1 leverage, you can control a $500,000 position using the same $1,000 margin.
Your account only needs to cover a fraction of the total trade value - this is called the required margin.
Leverage Example
Suppose you have $1,000 in your trading account:
Leverage | Buying Power |
1:1 | $1,000 |
50:1 | $50,000 |
100:1 | $100,000 |
500:1 | $500,000 |
Higher leverage gives you more market exposure, but also increases your risk.
Leverage and Margin
When you use leverage, you're trading on margin - the amount of your own capital required to open and maintain a position.
For instance:
At 100:1 leverage, the margin requirement is 1%
At 500:1 leverage, the margin requirement is 0.2%
Margin requirements vary depending on the instrument and your account type.
Why Use Leverage?
Traders use leverage to:
Increase exposure with limited capital
Maximize potential returns on small price movements
Trade multiple positions simultaneously
However, it’s important to remember that losses are also magnified, which is why risk management is crucial.
Leverage on Blueberry
Leverage settings may vary based on:
Account type (Standard vs Raw)
Instrument traded (Forex, Indices, Commodities, etc.)
Regulatory jurisdiction
You can view or request a change to your leverage settings via your Client Portal or by contacting our Support Team.
If you need help understanding how leverage works in your account or want to discuss which settings best suit your strategy, please don’t hesitate to reach out. We're here to help!