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What leverage is best for a newbie?

  • #121
  • Mar 7, 2019 2:04pm Mar 7, 2019 2:04pm
Quoting MarkFxAnde
What leverage will you advice as a newbie trader to use? Do you think 1:1000 is too high for inexperience trader to use? Because I have been advised against using high leverage but again I thought it broker have provided it why won’t I use it. What you think?
The right leverage for a newbie is zero. Let me explain.

If you don't know which is your optimal leverage for your timeframe and cannot define the position size and TP level that will protect you from a margin call no matter if you use or not SL, it means that you are not still a newbie. You are still a person who is learning to trade.

So do not put one single cent in a real market until you are so tired of practising and winning in demo mode and using simulators that you have a clear response for all those stuff by your own experience.

Otherwise, be prepared to burn all your account in a few weeks and lose all your money in a glimpse of an eye.

Learning to trade requires years of practice in demo. If in a hurry, then chose another business easier than Forex.
  • #122
  • Mar 7, 2019 2:13pm Mar 7, 2019 2:13pm
1:1
  • #123
  • Mar 8, 2019 7:45am Mar 8, 2019 7:45am
Quoting scherzi
{quote} The right leverage for a newbie is zero. Let me explain. If you don't know which is your optimal leverage for your timeframe and cannot define the position size and TP level that will protect you from a margin call no matter if you use or not SL, it means that you are not still a newbie. You are still a person who is learning to trade. So do not put one single cent in a real market until you are so tired of practising and winning in demo mode and using simulators that you have a clear response for all those stuff by your own experience....
Good answer. I was amazed to see my Oanda demo lock me 10X leverage as the lowest possible leverage to use. I then learned to adjust my position sizing to make the 10X in effect 1:1. But I agree with some others that newbs should focus on total risk per trade as opposed to getting stuck on how much leverage to us.
  • #124
  • Mar 10, 2019 5:16am Mar 10, 2019 5:16am
Newcommers should keep the leverage low in start coz high leverage can claim higher damages as well.
  • #125
  • Mar 10, 2019 11:54am Mar 10, 2019 11:54am
Quoting jollypk
Newcommers should keep the leverage low in start coz high leverage can claim higher damages as well.
Good advice
  • #126
  • Mar 11, 2019 12:36am Mar 11, 2019 12:36am
Forex is extremely difficult to trade.

A newbie is a person who already knows which is the optimal leverage for his/her trading style. If one does not know which is the optimal one, the right TP and SL levels if any, the best asset to put money in among the available ones of the broker or if one is not consistently earning in demo mode; then that person IS NOT a newbie, it is just an aspirant to newbie in his way.

Newbie is not one who desires to learn how to trade; newbie is one that is already profitable but without experience enough in real markets.

Forex is not an easy-to-get money method. In order to be a newbie, one needs years of study and practice; and all that basic stuff such as leverage level is not remotely anything that person worries about because there are very basic things a newbie already masters.

Anyone in a hurry should find a job and then start one's own way into trading over the weekends using simulators. Not even demo is required since simulation is much better. Demoing is only useful for adapting oneself to the actual market pace.

A Forex trader must be wise and methodical. Do you think the best way to train boxing to become a "newbie" is hurrying into the ring and fight Anthony Joshua?

A person doing that could even die in less than one minute. Now think about it.
  • #127
  • Mar 11, 2019 1:39am Mar 11, 2019 1:39am
Quoting jollypk
Newcommers should keep the leverage low in start coz high leverage can claim higher damages as well.
generally beginners level kick off trading with low leverage ,but after passing sometimes they cant control emotions when trading , as a result they use high leverage and become loser due to lack of real money management plan.
  • #128
  • Mar 11, 2019 2:43am Mar 11, 2019 2:43am
Please stop scaring us with all that leverage BS talks. It's simple higher leverage is better,because it's mean less money stuck with broker.What is more important is MONEY MANAGEMENT and discipline.
Whether you think you can, or you think you can't,you're right. H.F.
  • #129
  • Mar 20, 2019 11:55pm Mar 20, 2019 11:55pm
agree , leverage works greatly if there is real money management including discipline,
otherwise it can be a great deal to make a huge losses.
  • #130
  • Mar 24, 2019 11:46am Mar 24, 2019 11:46am
Quoting MarkFxAnde
agree , leverage works greatly if there is real money management including discipline, otherwise it can be a great deal to make a huge losses.
This is very true
  • #131
  • Mar 25, 2019 3:37am Mar 25, 2019 3:37am
Quoting scherzi
{quote} The right leverage for a newbie is zero. Let me explain. If you don't know which is your optimal leverage for your timeframe and cannot define the position size and TP level that will protect you from a margin call no matter if you use or not SL, it means that you are not still a newbie. You are still a person who is learning to trade. So do not put one single cent in a real market until you are so tired of practising and winning in demo mode and using simulators that you have a clear response for all those stuff by your own experience....
You are absolutely right; it’s a long term journey; there is no way to be a profitable trader within very short period of time! In addition, expecting any unrealistic profit is a disease.
  • #132
  • Mar 25, 2019 4:09am Mar 25, 2019 4:09am
Newbies should not be too worried about leverage, in fact MOST traders should not be concerned with leverage at all.

If you are new to trading, the maximum lot size you should be trading is 0.01- You don't get better at trading by trading bigger lots.

Leverage is only a measure of how much funds you CAN control, not how much you SHOULD control.

If you trade 0.01 lots with 2% max risk, you can only ever lose 2% of your bank on that one trade, regardless of whether you have 1:500 leverage or 1:1000000 leverage, or 1:30 leverage.

Leverage only ever comes into play when you want to open lots and lots of trades (ie basket/grid/martingale systems) or want to trade with massive risks (ie most basket/grid/martingale systems)
  • #133
  • Apr 5, 2019 2:18am Apr 5, 2019 2:18am
which leverage is more appropriate for beginners level , it depends on trading conditions , if trading in a demo 1:10 is comfortable and in live i don't support to use leverage , because it contains huge risk for all time.
  • #134
  • Apr 5, 2019 3:06am Apr 5, 2019 3:06am
Quoting BenDunk
which leverage is more appropriate for beginners level , it depends on trading conditions , if trading in a demo 1:10 is comfortable and in live i don't support to use leverage , because it contains huge risk for all time.
I always will insist in this recurrently: Newbies should never trade with real money. Wait at least one or two years spent practicing before you enter real markets, once you feel comfortable trading with consistent profits.
  • #135
  • Apr 5, 2019 3:30am Apr 5, 2019 3:30am
agree, new Forex trader should avoid trade with real money , because it can make them emotional. one or two years is a long time for waiting to trade in a real account. minimum 6 months beginners have to wait to be prepared for starting real trading.
  • #136
  • Apr 5, 2019 5:15am Apr 5, 2019 5:15am
Quoting MarkFxAnde
What leverage will you advice as a newbie trader to use? Do you think 1:1000 is too high for inexperience trader to use? Because I have been advised against using high leverage but again I thought it broker have provided it why won’t I use it. What you think?
Mr MarkFxAnde,

Its been a while you created the thread but I will still share my idea on the leverage for the newbies.

If you are new to forex. Play with demo accounts only. Once you have grip of the situation which will take probably years then you can switch to live account. Never trade more than you afford to loose.

It is good to trade in live account to practice because you take things seriously. But you should always trade little. But calculate the comission fees.

In terms of Leverage. I would go max 5 to 10.

Hope it helps,
Cheers
Newly wedded, already in debt.
  • #137
  • Apr 7, 2019 9:30pm Apr 7, 2019 9:30pm
If you have good capital and make decent amount of profit from the market fluctuation use at mors 5 to 10 leverage, other than that you would be risking you capital. Don't trade in 1m charts trade at least 15m charts, if you have enough confirmation.

Take care,
Haliss
  • #138
  • Apr 8, 2019 9:29am Apr 8, 2019 9:29am
Well, if you are trading a live account, than of course a lower end leverage is a better idea to keep from sabotaging yourself and blowing an account with large lots on poorly made trades. I would suggest anywhere from 1:10 to 1:100 depending on your risk management. take care
  • #139
  • Apr 9, 2019 1:42am Apr 9, 2019 1:42am
Quoting canabud
Well, if you are trading a live account, than of course a lower end leverage is a better idea to keep from sabotaging yourself and blowing an account with large lots on poorly made trades. I would suggest anywhere from 1:10 to 1:100 depending on your risk management. take care
What has leverage got to do with managing risk?

Leverage ONLY gives you the ability to open bigger lots, or more trades.

You say 1;10 to 1:100 depending on risk management? Well, how does risk management come into play with leverage, unless you want to use 50% risk on every trade? If you risk 1% per trade, it makes no difference whether you have 1:100000 leverage, or 1:30 leverage. In actual fact the only time it would come into play would be if you have to LITTLE leverage where you are unable to open a trade at all (ie, risking 1% of your account, with 1:1 leverage, and you have an account of $250) for instance...

The idea that leverage is the big evil is a complete and utter myth. It is the risk that is the great evil. play with too much risk, and regardless of your leverage, your account will go pop (for 95% of traders that is) Leverage only caps the amount of risk you are able to attribute to each trade as an overall to your account if it is too small.

I have posted about my trials because my stop is low - 5 pips, i could only open 1 trade at any time on 1:30 leverage, and my risk on account was 1%... leverage hindered my trading MASSIVELY. now at 1:500 I can actually trade with room to breathe...

If people don't understand the concept of limiting risk, then they deserve to blow their accounts...
  • #140
  • Apr 9, 2019 2:20am Apr 9, 2019 2:20am
Thanks for your nice post , leverage gives the opportunity to open bigger lots , its true even though there is small amount , this ability most of the time make traders greedy and they try to bring profit very rapidly but ultimately most of the time they become loser due to non-sense planning.
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