Options & derivatives
Leverage (derivatives)
In derivatives, leverage lets you control a large exposure with a small outlay, amplifying both gains and losses.
In derivatives, leverage lets you control a large exposure with a small outlay, amplifying both gains and losses.
It is the main appeal of CFDs, futures and options, but also their greatest danger: a small adverse move can wipe out the stake, even trigger a margin call. Leverage demands flawless risk management.
At 20:1 leverage, a 5% move in the underlying doubles or wipes out your stake.
Understanding a term is good. Applying it on a real platform with a clear method is better. That is exactly what we do in 5 days.