Recently increased the popularity of trading in the foreign exchange market.Terms of the transactions within the Forex attracted not only by the availability and the ability to earn money from home, but also great offers from brokers.One of them - it's leverage.Forex is the opportunity to earn on currency fluctuations.Not every day can please the foreign exchange market traders powerful fluctuations in prices.To the substantial profits in those minor disturbances in the sea exchange is necessary to carry out transactions at a fairly significant amount.As a rule, the private investor does not have such opportunities.
attractiveness of work in the Forex lies in the fact that traders are given the opportunity to open a trading position weighty using brokerage bail.That is what is leverage.Forex allows you to ensure that the position of greater value by delivering the broker additional funds that can be used specifically for trading.The increase in expected profit, respectively, leads to an increase in the size of potential losses.But the talent is, and the trader to skillfully maneuvering in a constantly jumping exchange rates, lose less than winning.
starting to trade on the forex market, leverage the parties stipulate at the time of opening the account.Typically, this ratio is up to several hundred to one.This means that on account of having just one dollar, the investor gets the opportunity to open a position for a few hundred dollars.There are several reasons that the broker offers the trader leverage.Forex trading as the market gives a real opportunity to earn a profit on the amount of the investor's percentage goes to the broker.Also, the trader is able to make a few deals.We can say that this leverage is an essential means of ensuring a successful start most new investors.
Let's try an example to understand how leverage works.Forex traders account is $ 1,000, provided the leverage ratio is 100: 1.Buying GBP per USD at 1.4349, an investor really has an opportunity to operate with a wallet in the 143 490 GBP.Changes in quotations even for a few items, or lead to profit or loss to the tens of dollars.
Operating with the market, it should be noted that so-called collateral margins for a positive outcome of the transaction substantially increases the profit of the investor, but at the same time, the negative results in increased losses.With margin trading trader who places the guaranty capital, given the opportunity to manage the trust loans, which are allocated under the bail.At the same time it guarantees its deposit compensation possible losses on foreign currency positions gives them.
also the trader task is to constantly monitor the remainder of the margin and not to forget the stop order, because it is thanks to them you can limit the damage.Otherwise, you can get into a situation where there will be an automatic closing of all open positions in the fall of the capital in the account below the level that received the term Margin call.
