We have tried to explain to you what is a Forex leverage system and what kind of benefits and harms it has in an understandable language. In this system, where the risk is quite high, it is necessary to process very carefully.
If luck smiles on your face and you can also predict the market, it is very easy to make money on Forex. But it’s very easy to lose money. With a wrong decision made at one time, you can lose a lot of money, and much more than the money you invested. Your gain is a lot, but your loss is the same amount more. The reason for this is the leverage system used. So what is the Forex leverage system ? Let’s take a look at this if you want.
What is the Forex Leverage System?
If it is necessary to explain the Forex trading system in an understandable language;
You created a forex account and loaded $1,000 into it, for example. This money you are loading is as if you loaded $ 100,000 with the leverage system (maximum 100 times). This system is both logical but also risky.
We think that we have given the answer to the question of what is a Forex leverage system in a short and understandable language. So how does this system help you?
The benefit of the leverage system is that at first you double your money to 100, but don’t think of a thought like “I’ll load $ 1,000, I’ll withdraw $ 100,000 after 2 days”, no one makes money so easily. The benefit of the system is that you can make a $100,000 transaction instead of making a $1,000 transaction. What does this mean ? If we give an example;
1 ton of sesame seeds is $ 1,000, and if you didn’t have the leverage system, the maximum amount you could get was 1 ton. But thanks to this system, if you want 10 tons, if you want 20 tons, if you want, you can buy 100 tons of sesame with all of 100,000 dollars. So you bought 100 tons, and as soon as you made a profit, you sold it, and you got $100,000, $110,000 for you. (This is purely an example.) As a result, you earn $ 10,000, that is, your money invested by $ 1,000 becomes $ 11,000.
This system is very useful and very logical when you are making a profit, earning. You can make a lot of money with a little money that you charge.