Is high leverage really bad for traders?

The issue i see is this. What is the relationship of your capital? Risk to reward? And leverage?

If a trader does not know this? Because this relationship actually determines how much a person may be willing to lose or win and the number of chances said person is able to use the Edge of the strategy, then one should learn it or don't trade at all.

Ex.

50 dollar account with 4 to 5 % risk per trade like the exercise by mark doughlas means 25 to 20 pips per .01 lot for those trades. Or lower number of pips if higher lots.

It's a lot of work to come up with a personal trade plan.

But i wouldn't start trading if the capital i have with my preset max risk does not equal atleast 20 to 25 trades.

A good strategy to apply but has little win rate is the retirement session of the dr idr by m7.

You probably will lose 3 x before a win. But the rr is magnificent. That over all you will make profit. Or the suppy and demand strategies where price returns to the zone. It'll break that zone 3 out of 4 x but on that one time you win, you get a lot of reward over pips.

This is why it's really important to have higher rr and more chances to be in the market.

My fbs broker is like this
below tp but still no profit below trading point but no profit

Is this normal ?

Hello,
Open, High, Low, Close showing data for the Bid price. You had a sell position. To close your position you need to buy from the market at the Ask price. It looks like it's aud/usd pair, fbs broker shows 1.4 spread. Your take profit at 0.66544, bid price 0.66534 add 1.4 spread and you will get 0.66548 ask price. The price did not reach your take profit.

Depends on how well you use it. High leverage can amplify both profits and losses. It offers the potential for significant gains but also increases the risk of substantial losses. Effective risk management is crucial when using high leverage

I agree, it depends on the trader if you are well aware of the trading activities and the market around you it is possible to gain high profits using leverage.

If the risk to capital does not allow you to take advantage of the statistics per setup, which according to mark doughlas is atleast 20 trades, then you are not giving yourself a chance for consistency.

Lets say your entry is shark model harmonics. Taking every shark atleast 20x strictly will net you a positive return. But if you only have 5 tries, chances to burn the account is higher. And lets say you only have 1 try, then that's a 50% chance of killing your account.

I have a different opinion on this one. Yes higher leverage could give you the potential bigger gains if you have a good market understanding.
However, even if you're the best trader in the world, you couldn't expect every moves of the markets, especially some low-probability blackswan event.
During those event, if you're over leveraging and the price goes opposite your direction, you would easily get slippage a lot and went into a negative balance.
Overall i dont think trading with a high leverage would be a very good choice to do so.

A high leverage allows you to open positions with only a small fraction of the total contract value of the assets traded so yes leverage could be definitively be bad for traders..
However, it is also worth to mention that if you apply risk management with stop loss, you will always know how much you'll lose on each trade and a different leverage in this case will not dictate the amount you are going to lose but only the amount needed to open each position.

I love 200 and I'm planning to move on to 500 or maybe 1000 In the future. I start at 50. And it took me a while to get used to trading at 200. But at the end It was worth it.

Yep, high leverage brings certain risks and it's been restricted by certain regulator not for no reason.
Rookies abuse high leverage and because of the excessive margin size, they are thrown out from the market very quickly. That is why all learning courses include separate chapters of how to work with the leverage, how to create proper risk management strategy.
It's good if you enter the market with humble sums, but at the same time, it's better not to risk if you aren't sure.

Traders, who usually chit chat in the community, don't have any aim to cheat on others, as they don't have any profit from that. So if the majority claims that high leverage is very harmful for traders, then it's really like that. We are in the community, so it makes sense to listen to what the majority says, as it consists not only of rookie traders, but advanced too. Experts know what consequences trading with high leverage lead to.
High leverage quickly eats the whole margin in case you are mistaken and made a wrong analysis. Watch out.

If you have a consistent and very high win rate, then it is not. Only logical

But then... takes a lot of spirit to achieve that

Is 1:2000 or 2000:1, too high of a leverage?

Yes, a leverage of 1:2000 or 2000:1 is extremely high and carries a substantial risk of significant losses, especially in volatile markets. Such high leverage can lead to rapid account liquidation if the market moves even slightly against the trader.

Leverage is a double-edged sword in trading. While it has the potential to significantly amplify your profits, it also increases the risk of incurring larger losses than expected. The key to using leverage effectively lies in careful risk management.

At ThinkMarkets, we offer leverage up to 2000:1, allowing traders to potentially increase their exposure with a smaller initial investment. However, we strongly encourage our traders to use risk management tools, such as take profit and stop loss orders, to help protect their funds. These tools are essential for limiting potential losses and locking in profits, providing a safety net in volatile market conditions.

It's crucial for traders to understand their own risk tolerance and to use leverage in a way that aligns with their trading strategy and goals. Trading is not just about maximising profits, but also about minimising losses and managing risk effectively

High leverage means more risk. It's as simple as that, in my mind.

BUT, if you are getting returns commensurate with that risk, then it's not a bad thing - assuming you have the tolerance for the risk.

In trading, leverage is considered a double-edged sword. It has the potential to significantly amplify profits despite limited capital and small movements in the market. However, this also goes the other direction where losses are magnified and can exceed the initial invesment should the market move sideways.

While it sounds daunting, leverage should neither be feared nor taken lightly. The key to managing leverage lies in a robust trading strategy and strict risk management. Setting realistic take-profit and stop-loss orders, understanding your risk exposure relative to your account balance, knowing your broker's margin call policy are just some essential information you should study before trying out leveraged trading.

Not if you're really good at it. For beginners, Always start with low leverage if you don't want to blow your account right away lol.

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Leverage is undoubtedly dangerous if used incorrectly, but it can improve your position during the trading process itself if you intend to continue in the same position until the end and do not want to terminate the deal.

In my experience as a trader, high leverage can amplify both profits and losses. While it can potentially lead to significant gains with a small initial investment, it also increases the risk of substantial losses if trades move against you. Therefore, it's crucial to use leverage judiciously and consider the impact on risk management and overall trading strategy.