Leverage:100:1 or 200:1?

What's is the advantage of trading with 100:1 or 200:1. My live currency acct is 100:1 leverage, my commodities acct is 200:1. I trade 0.3 lots with the 100:1 which cost me $300 per trade. What would be the advantage of moving up to 200:1? Can't I just do 0.6 lots with 100:1 leverage. What's the advantage here? Thanks!

You could trade less lots with a higher leverage and achieve the same result. However the main reason for leverage is to amplify your trading amount, obviously this will amplify your potential gains and/or losses.

if you've got it, use it. my vote is 200:1, just in case.

this has been debated to death.

Leverage values SHOULD NOT have any impact on the number of lots you trade. Yes, higher leverage will allow you to buy more lots but does that really make sense?? What you should be looking at for each trade is not the leverage but the amount you are willing to risk per trade.

If I buy 1 lot at 200:1 leverage and it goes against me 50 pips before I close the trade it will cost you the same as purchasing 1 standard lot with 100:1 leverage.

Higher leverage was put there for one reason.... to get you to buy more than you should and for the most part (some do get lucky) end up sucking your account dry faster.

The question about leveraging is interesting but the thing I would be looking at first is are you trading profitably and if the anwser is yes then I would go 1:200 if the anwser is no then I would stick too 1:100.

Why loose more money than you should if you are in the learning stage of your trading.

cheers

WIsh you did understand the term of margin before you ask this out.

Juz my example to make your sky clear.
This is juz an calculation by me, plz do correct me.

G/U 1.9600
We buy 10000unit.
1.9600 * 10,000unit = USD 19600 <-- We bought this amount

USD19600 / 100 (leverage) = USD 196

USD19600 / 200 (leverage) = USD 98

Means if you open an position with 100 leverage, you need USD 196 of margin in your account.

wif 200 leverage, you need USD 98 of margin in your account.

What is margin? I take it as a 'mortgage', whereby we nid to mortage USD 196 in to the broker in order to let us use the leverage of 100:1 and place a position of 10,000unit.

Wish i make it clear

First you determin you risk and next your lots size depending on your leverage. So the leverage is the last thing you think about not the first.

The leverage your broker offers only affects your margin. It should have no influence on your position sizing at all. If you have 200:1 leverage vs. 100:1 leverage you will post half as much margin. A pip is a pip and leverage does not change that.

Offering high leverage is a way to entice the uninitiated to chose a particular broker. Seriously, you shouldn't need more than 50:1 leverage to trade responsibly so please, don't let high leverage be a deciding factor when chosing your broker.

If the risk of margin or a margin call are a concern in your trading then your account is a ticking time bomb. It's only a matter of time before it goes off. After it explodes you do get a nice parting gift though...the broker will give you the margin that he held on your behalf.

Thank you for all the replies.

I trade 100:1 on my currency account and 200:1 on my commodities account. I think I'll stick with the 100:1.

My currency account I trade live $5k balance with 0.3 lot trades. Commodities demo I trade $50k with 3 lot trade. Right now I'm up to $410,000, haven't moved my lot size up. Keep with 3 lots and try to stay with $50,000 margin out.

If need be I'll move lot sizes up once my balance increases, stick with the 100:1 leverage. I gain constantly with the commodities, but currencies are a little tougher for me. Been trading commodities full time for 1.5 years. Currencies full time just recently.