Hello,
I've been studying trading for 2.5 years now, but still don't understand pip value in relation to leverage. I know that if my leverage is 25:1 and my account size is $1000, then I can trade $25000 or two EURUSD mini lots.
I have two questions:
1) Why do traders say that with having more leverage you can lose more money? Is it because I can trade more lots at the same time?
2) If I chose to open 1 micro lot only, with 25:1 leverage, then how much will my pip value be for EURUSD? Will it be 25 times more, that is, $25? I have no idea?
thanks,
I've been studying trading for 2.5 years now, but still don't understand pip value in relation to leverage. I know that if my leverage is 25:1 and my account size is $1000, then I can trade $25000 or two EURUSD mini lots.
I have two questions:
1) Why do traders say that with having more leverage you can lose more money? Is it because I can trade more lots at the same time?
2) If I chose to open 1 micro lot only, with 25:1 leverage, then how much will my pip value be for EURUSD? Will it be 25 times more, that is, $25? I have no idea?
thanks,