Why do you limit the maximum drawdown on the account? - page 25
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OK, then explain how is it possible to open 1 lot ($100,000) with a deposit of $1,000? Where does the money come from to open such a position?
It comes from nowhere. I opened a long. One pip is $10, you, at the same time, are on a short. On a move in my direction you took it and gave it to me from your depo to mine. Otherwise the opposite is true. All within depo limits. Normal CFD rules.
But Fa's shoulder is a bit of a stretch.
Why bent? Leverage is credit, REAL, either in the form of money or an asset. In forex and CFD there is a price of a pip. And the depo is a pledge to pay for these pips.
The leverage is a marketing trick of brokerage companies for clients (clients of this madhouse) to think that brokerage companies are reliable - they have millions and billions dollars. They have nothing. They bought a coputer and took an μl - they put it all in their flat.
It is not coming from anywhere, as well as going nowhere. Leo, come on - this is the basis for margin trading. If you initially agreed that when you open a deal you must close it on the reverse, and your real money serves as a guarantee that you will fulfill your obligations under this deal, then you will be given to open a deal even for a billion dollars, if the deposit is enough to cover possible losses from this deal. No one takes or gives credit-deposits from anyone. And the leverage Fa bent, it just is, it can not not exist, because it and determine how much bigger transaction can be allowed to open on the specific markets relative to the pledge. For if the deposit is enough for 1 pip of movement of an instrument, who needs such adventures, who will take the risk?
Yes I know that and I understand it.
However, in fact, the scheme you describe is a kitchen scheme that does not bring your open position to the market. Using this scheme, in fact, the brokerage company is interested in losing your deposit, because in this case the brokerage company earns from the spread and the traders' deposits.
If the brokerage company brings open positions to the market, then the brokerage company has to take $100,000 somewhere, but you have only $1,000 on your deposit. Where will the brokerage company get $99,000 to bring it to the market? And in this case, in fact, the trader borrows from DC, because he can close the position in a month, and the money to DC must be returned now, not in a month after the trader closes the position.
Yes, I know and understand that.
However, in fact, the scheme you describe is a kitchen scheme that does not bring your open position to the market. Using this scheme, in fact, the DC is interested in losing your deposit, because the DC's earnings in this case are the spread and the traders' deposits.
If the brokerage company brings open positions to the market, then the brokerage company has to take $100,000 somewhere, but you have only $1,000 on your deposit. Where will the brokerage company get $99,000 to bring it to the market? And in this case, in fact, the trader borrows from DC, because he can close the position in a month, and the money to DC must be returned now, not in a month after the trader closes the position.
The same goes for ECN and non-deliverable futures. All these are in fact contracts for difference, not buying/exchanging real assets. In a fund, yes, the broker gives real dough and charges interest daily for it. And there the maximum leverage is 1:5, but more often 1:2.
the same for ECN and non-deliverable futures. All these are in fact contracts for difference, not buying/exchanging real assets. In a fund, yes, the broker gives real dough and charges interest daily for it. And there the maximum leverage is 1:5, but more often 1:2.
Have you seen the commission on an ECN, apart from the spread? The leverage is floating. The stopout may be as high as 100%. In fact, on ECN, it is not possible to reach a leverage of 100. The maximum is 50, for small lots.
Yes I know that and I understand it.
However, in fact, the scheme you describe is a kitchen scheme that does not bring your open position to the market. Using this scheme, in fact, the brokerage company is interested in losing your deposit, because in this case the brokerage company earns from the spread and the traders' deposits.
If the brokerage company brings open positions to the market, then the brokerage company has to take $100,000 somewhere, but you have only $1,000 on your deposit. Where will the brokerage company get $99,000 to bring it to the market? And in this case, in fact, the trader borrows from the brokerage company, because the trader can close the position in a month, and we have to pay to the brokerage company now, not in a month after the position is closed.
I agree. But they give him bail for nothing? - Of course not.
He pays for it. Less, of course, but he still pays for it.