Do you have to pay leverage back?

The answer is NO. The forex market operates like futures, not like stocks. In stocks when you trade on margin it means you borrow money from your broker. When the trade is done you have to pay the broker back.

What happens if you lose your margin?

If a margin call is issued and the investor is unable to bring their investment up to the minimum requirements, the broker has the right to sell off the positions and also charge any commissions, fees, and interest to the account holder.

What triggers a margin call?

A margin call is triggered when the investor’s equity, as a percentage of the total market value of securities, falls below a certain percentage requirement (called the maintenance margin). … The investor’s account has $10,000 worth of stock in it.

How much can you lose with leverage?

A trader should only use leverage when the advantage is clearly on their side. Once the amount of risk in terms of the number of pips is known, it is possible to determine the potential loss of capital. As a general rule, this loss should never be more than 3% of trading capital.

How much can you lose with margin?

The biggest risk from buying on margin is that you can lose much more money than you initially invested. A loss of 50 percent or more from stocks bought on margin equates to a loss of 100 percent or more, plus interest and commissions.

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