Working of Leverage!!!

Guys,

could someone please tell me what is leverage and how it works.

some says 1:100 is best,
some says 1:200 is best and
some says 1:400 is best.

Someone please tell me what does this mean?

Thanks

http://www.babypips.com/school/leverage_defined.html

Dear brother,
let me tell you what is leverage.basically leverage means t borrow.mostly 1:99 use in the international market.thats mean u just have to pay 1% and u will get relief of 99%.but you will be the owner of 100 %.hope it would get clear to u.

Take care

some says 1:100 is best, = $1 controls $100
some says 1:200 is best = $1 controls $200
some says 1:400 is best = $1 controls $400

Don't get too excited, as leverage helps on the way up, but without proper risk management, it will damage you on the way down.

The concept of leverage is linked with margin deposit. But there is the difference between this terms. However for trader there is only one effect : bigger leverage –bigger ratio between equity and the possible margin transactions. So, leverage – is the ratio between the amount of the pledge and the borrowed funds allocated for it: 1:100, 1:200, 1:500. The leverage 1:100 means that for a deal execution you should have the trading account with the broker in the amount of 100 times less than the transaction sum. The crediting coefficient is called the leverage. Its value may vary widely from 1:1 to 1:500, which means the possibility of buying/selling the currencies by the client in the amount exceeding the pledge sum of 500 times. For example, if the trader chooses the leverage 1:100 for the trading account and makes the deposit of 100 USD, then he has the opportunity to purchase the currency amounting to 100*100=10 000 USD. The trader's risk is restricted only by the amount of the pledge, as the financial dealer (dealing center) doesn’t provide the real amount of currencies for the whole sum of the opened transaction, but only guarantees the deposit of the loss or profit sum in full at the deal's closing.
. If your leverage bigger, than you will lose your money faster. Let’s consider one example. Your leverage is 1:50, so the deposit(margin) is 2% from the transaction’s size. You have 10 000USD on your account and decide to buy 5 lots. Now it’s enough 200 pips of moving to lose our account completely.