What's the best leverage for beginners?

GMoore87

Junior member
46 5
Leverage is a two-sided sword. High and low can be both good and bad. So, whats the common point?
 

J_C_Anderson

Active member
128 21
As usual, for the beginners it would be better to use lowest possible leverage to reduce the risk. At the same time, most of the newbies use huge leverage to get more buying power because their initial deposit is often very small, so it is difficult for them to get sufficient profit. It is quite common for the novice traders to overload their accounts with the positions using high margin level, so they will incur substantial losses in case if the price will move in the opposite direction. Sometimes they could even blow off the entire account just after one or several traders due to such approach.
That is why in most of the cases it would be better to reduce the leverage to the lowest possible level to minimize the risk of loss that would be too large to impact further trading.
At the same time, it is impossible to trade without leverage at all (if we speak about Forex) because all price movements are relatively small, so you need to have a substantial enough trading capital to make large profit.
 

hatemypips

Well-known member
472 34
Leverage is a two-sided sword. High and low can be both good and bad. So, whats the common point?
I use 1:100 with Hotforex and just adjust lot sizes accordingly. I don't think you have to choose to low leverage because you have always another option to adjust risks. But at the same time you have to keep opportunities in your pocket whenever possible.
 

GMoore87

Junior member
46 5
As usual, for the beginners it would be better to use lowest possible leverage to reduce the risk. At the same time, most of the newbies use huge leverage to get more buying power because their initial deposit is often very small, so it is difficult for them to get sufficient profit. It is quite common for the novice traders to overload their accounts with the positions using high margin level, so they will incur substantial losses in case if the price will move in the opposite direction. Sometimes they could even blow off the entire account just after one or several traders due to such approach.
That is why in most of the cases it would be better to reduce the leverage to the lowest possible level to minimize the risk of loss that would be too large to impact further trading.
At the same time, it is impossible to trade without leverage at all (if we speak about Forex) because all price movements are relatively small, so you need to have a substantial enough trading capital to make large profit.
I totally agree and what I could understand from your answer was, there is no such thing called the perfect leverage?
 

GMoore87

Junior member
46 5
But at the same time you have to keep opportunities in your pocket whenever possible.
Exactly. To make a profit, you need a high leverage. The price movements are small most of the times.
 

Anci_smith

Newbie
8 0
Beginners should always try to trade on a lower leverage level in the start. They can ofcourse increasing it up gradually when profitable, but in the beginning, its better to take a little less risk.
 

fibo_trader

Senior member
2,352 44
The pessimist sees the glass as half empty. The optimist sees the glass half full. The stock market day trader just adds Leverage aka Whisky

Money talks but to a highly levered trader all she says is "goodbye"
 

fibo_trader

Senior member
2,352 44
Help them Father for they know not what they do and have such a poor understanding of Leverage that they use it when they shouldn't and don't use it when they should. They talk on the subject of RISK like they are such big shots - but if an observer steps out into the parking lot and just watches 'em, the first thing they'd notice is that these talkers are driving a car with only 3 wheels and loaded to the hilt with beer cans and cig butts in the back seat - on their way to an apartment that can be best described as the basement right next door to a toilet that has yet to be cleaned this century



Leverage done in sybaritic splendor as opposed to its opposite, Pyrrhic Victory

EurUsd 1H as an example -

stay at the beach, go travel even for the day or weekend or do other work on your computer like knocking yourself out with listening to music, writing, Chess, writing letters, a book, whatever = enjoyment ..................... then when wave 2 is getting ready to terminate, get the Leverage sack ready and drop to 5-min TF for the signal and boom, there are your profits for the entire year in just one play assuming 60k/yr covers the annual bills of all the bums here. Just one 3rd wave that is over in 2 days gives you the so-called sought after FREEDOM that goes with TRADING.


270318






applies to every instrument which means there is no FAMINE. What does it take to be able to do stuff like this? Knowledge and Skill.

Try convincing ANYBODY at T2W or in England that K & S are the essence of Life. They will lafffff in your face. They want it free without doing the work and even then, will abuse it and kill thesssselves.

That's just the way it is, always has been and always will be. Human Nature don't change much.
 

fibo_trader

Senior member
2,352 44
In Sales organiztions all over America if only the Sales managers knew stuff like this, the corporations would boom even more. Only in America is it really truly understood that nobody makes a figgin dime until a product or service is SOLD. In 3rd world countries a Salesman is treated like a leper. A Closer? WTF is that? Not in America. A closer is as close as you get to Godlike! :)

So, how to apply the 3rd wave magic? If let's say the corp. has a crew of 30 sales/closers, their performance is charted in Excel or any program like Metastock etc., then the Sales manager watches like a hawk for when a fella's wave 2 is almost completing and then starts shoving leads right in their face = hi-leverage as leads are very expensive - the closing average of the closer will skyrocket during a 3rd wave. Each individual has a different setup in Life so their individual 3rd waves are not going to occur in lockstep. In fact when one is in a 2nd or 4th wave decline, another might be in a 3rd wave boom. that's where you pour the leads.

Been there done that for an outfit I was asked to help. Sales shot up to numbers never heard of. The owner then became a trader after the 3rd wave stuff so intrigued him and the money talked so loudly, he liquidated and used the Capital for full time learning to trade and to trade.

Welcome to Paradise!
 

fibo_trader

Senior member
2,352 44
Leverage just begging to be used ...................

From the book that Trendie read ................. "The old man and the Sea" ...... the fish rose out of the water showing all his breadth and majesty .............

that's a 3rd wave and the adjectives used to describe such a wave are themselves stellar - wtf do you guys think is a ROGUE wave in the open ocean that has crippled many a ship in a heartbeat? A 3rd wave.

Now apply the same concept to the Beatles and observe where exactly their 3rd wave ended and went into the 4th and then the final rise in Wave 5. Then started the A-B-C = goners = finito

I believe George Harrison's 3rd wave was somewhere here ...................

 

fibo_trader

Senior member
2,352 44
Leverage just begging to be used ...................

From the book that Trendie read ................. "The old man and the Sea" ...... the fish rose out of the water showing all his breadth and majesty .............

that's a 3rd wave and the adjectives used to describe such a wave are themselves stellar - wtf do you guys think is a ROGUE wave in the open ocean that has crippled many a ship in a heartbeat? A 3rd wave.

Now apply the same concept to the Beatles and observe where exactly their 3rd wave ended and went into the 4th and then the final rise in Wave 5. Then started the A-B-C = goners = finito

I believe George Harrison's 3rd wave was somewhere here ...................





The 5 waves of the Beatles including the A-B-C that followed plotted based on the social mood meter best delivered by the Dow Jones


270319
 

hatemypips

Well-known member
472 34
The 5 waves of the Beatles including the A-B-C that followed plotted based on the social mood meter best delivered by the Dow Jones


View attachment 270319
Most stuff I seen from Elliot Waves is a result of hindsight analysis. This is the problem with all technical strategies, but well they provide good context to interpret imbalances in buying and selling pressures. Much of the uncertainty remains.
 

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