Money management - page 8

[John Winsome Munar]

Marian Nelu Iopsu #:

Thank you for your example, it is correct

1:1 leverage

margin used 100.000

10 pips loss is 100 

return is negative 0.1%

1:100 leverage

margin used 1.000

10 pips loss is 100

return is negative 10%

leverage has to do with money used in your position of 1 lot, while loss is in both cases 100, the return on used money is diffrent based on leverage

You have 2 accounts, one with 1:30 another 1:500 leverage. You open same positions, same pairs of 0.01 lot with $5 sl. Both trades hit sl at the same time. You lost $5 on both accounts. Which of your account has greater "risk"?