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mt4...account information and leverage

  • #1
  • First Post: Aug 22, 2006 3:10am Aug 22, 2006 3:10am
Hi,
I opened an account with 5000 $ and 1:100 leverage.When I open a new position, with 1.00 size the position will be 500.000$,right? How can I open positions with lots of 10.000$?
thanks

Canados
  • #2
  • Aug 22, 2006 3:28am Aug 22, 2006 3:28am
Quoting canados
Hi,
I opened an account with 5000 $ and 1:100 leverage.When I open a new position, with 1.00 size the position will be 500.000$,right? How can I open positions with lots of 10.000$?
thanks

Canados
http://www.forexfactory.com/forexfor...ead.php?t=7274

Peter
  • #3
  • Aug 22, 2006 4:03am Aug 22, 2006 4:03am
Quoting PeterFM
http://www.forexfactory.com/forexfor...ead.php?t=7274

Peter
thanks...I think I should open a new account..I don't know how to change the leverage in the opened account,maybe it's not possible

Canados
  • #4
  • Aug 22, 2006 4:08am Aug 22, 2006 4:08am
Quoting canados
thanks...I think I should open a new account..I don't know how to change the leverage in the opened account,maybe it's not possible

Canados
If it's a demo I wouldn't worry. If it's live it will depend on the broker's terms. You may be able to reduce to micro lots (live) if the terms allow.

Peter
  • #5
  • Aug 22, 2006 4:13am Aug 22, 2006 4:13am
Quoting PeterFM
If it's a demo I wouldn't worry. If it's live it will depend on the broker's terms. You may be able to reduce to micro lots (live) if the terms allow.

Peter
thanks..I opened a new demo account with 10.000 deposit and 1:5 leverage,it's easy.....but...how do I open positions of 10.000$?Maybe I have to choose 0,20 in the posizion size?

canados
  • #6
  • Aug 22, 2006 4:52am Aug 22, 2006 4:52am
Quoting canados
thanks..I opened a new demo account with 10.000 deposit and 1:5 leverage,it's easy.....but...how do I open positions of 10.000$?Maybe I have to choose 0,20 in the posizion size?

canados
To give you the longest trading period you can use to survive, the consensus amongst the experienced traders is that you should start with NO LOWER than 100:1 account leverage, 200:1 is better.
I'm not sure what you mean by 1:5, but when you place a trade you should choose the option 0.01 (if it's there) or the lowest on the options you have.
Once you place the trade you'll see the value of the lot size. (see image)
This may help you a little more (Thanks Dial)
Quote
It depends on what lot size you are trading: standard, mini or micro

For a standard lot each pip is worth $10
$10 times 20 pips = $200
$50 divided by $200 =
0.25 standard lots or
2.5 mini lots or
25 micro lots

In each case, the position size = $25,000

200:1 leverage is the maximum your broker provides. The only advantage this offers you is a lower margin requirement.

The leverage of the trade is called True Leverage and is found by dividing the position size of the trade, $25,000 in this case, by your account size of $5000. So $25000/$5000 = True Leverage = 5:1

5:1 leverage is okay IF you have a lot of experience. It is NOT okay for a beginner. A beginner with little to no experience will wipe out their account using 5:1.

A beginner should use 1:1 leverage or less until they have learned how to trade with consistent profits over time.

A beginner should also trade a micro account with $1000 lots. Period. End of discussion.

A beginners objective is not making money.

A beginners objective is to learn to trade with consistent profitability over time. If you can't make money trading a single micro lot, then adding more lots is only going to deplete your account faster.

Trading is easy once learned, but learning to trade is very difficult. It is going to take time, a lot of effort, and lots and lots of reading reading reading.

This is the best forum on the web for learning to trade forex, but a person has got to exert themselves and apply effort.

Dial
Attached Image
  • #7
  • Aug 22, 2006 4:56am Aug 22, 2006 4:56am
These guys are better at explaining leverage than me, they are far more experienced and I may mislead you.
Leverage takes some understanding when you first start, and I'm learning, so I'm not the best person to talk to.

http://www.forexfactory.com/forexfor...ead.php?t=7026

Peter
  • #8
  • Edited 5:40am Aug 22, 2006 5:26am | Edited 5:40am
1:5 is the leverage option I setted when I opeden the account...I suppose that with 10.000 I can open 50.000$ position...When I want to open a new position in the window I see: 0.10 0.20 0.30 0.40 0.50 1.00 and so on....
I don't understand well what these numbers are and how to use them?I'm an ignorant...what does "volume" means?

Canados
  • #9
  • Aug 22, 2006 6:23am Aug 22, 2006 6:23am
Quoting canados
1:5 is the leverage option I setted when I opeden the account...I suppose that with 10.000 I can open 50.000$ position...When I want to open a new position in the window I see: 0.10 0.20 0.30 0.40 0.50 1.00 and so on....
I don't understand well what these numbers are and how to use them?I'm an ignorant...what does "volume" means?

Canados
0.10 - 0.20 etc is the basic size of the lot you are trading with. So....

If you are trading with a Money Management strategy that allows to to place 5 lots, but still stay within your 1% risk, you would select 5 lots X 0.10 (.50).
Some strategies advocated here would then tell you to take of 33% of your trade at a certain winning position (say 20 pips profit), so if you were long with 5 lots you would sell 2 lots at that point (Sell 0.20). This would leave 3 lots (0.30) still in the game. You might move your stop loss to break-even + 1 at that point so you would not end up losing if the trade reversed.
Other options would be to start a trade with 1 lot (0.10) and then as you move to winning position, AND the move looks solid, add another lot. You would now be running with 2 lots (0.20).
For now I would just trade 1 lot (0.10 or 0.20 whatever is the minimum on your account) until you find a trading method that keeps your profit line rising.
Once you have a method that works, then play around with multiple lot sizes.
Hope this helps.
Peter
  • #10
  • Aug 22, 2006 7:13am Aug 22, 2006 7:13am
ok...good explanation...last question...how can I choose the lot size?1.000,10.000 or 100.000....

Canados
  • #11
  • Aug 22, 2006 7:25am Aug 22, 2006 7:25am
Quoting canados
ok...good explanation...last question...how can I choose the lot size?1.000,10.000 or 100.000....

Canados
Just stick with the 0.10 option for now. Don't worry about its value in true dollar terms.
The only thing you should be worrying about is 'is what I'm doing gaining me more pips than I'm losing?'.
Once the answer to that is YES you will have spent enough time to understand what each pip (and lot) is worth for each currency (there is a difference, but that's another story!).
Just keep reading and please DO use the search engine on the site. You aren't the first to hit this problem (and you won't be the last) and there are lots of threads explaining this.
Peter
  • #12
  • Aug 22, 2006 7:36am Aug 22, 2006 7:36am
Quoting PeterFM
Just stick with the 0.10 option for now. Don't worry about its value in true dollar terms.
The only thing you should be worrying about is 'is what I'm doing gaining me more pips than I'm losing?'.
Once the answer to that is YES you will have spent enough time to understand what each pip (and lot) is worth for each currency (there is a difference, but that's another story!).
Just keep reading and please DO use the search engine on the site. You aren't the first to hit this problem (and you won't be the last) and there are lots of threads explaining this.
Peter
ok..thanks again...but my problem was not about MM (I understood well MM), but about the usage of the mt4 platform

canados
  • #13
  • Last Post: Aug 22, 2006 7:54am Aug 22, 2006 7:54am
Quoting canados
ok..thanks again...but my problem was not about MM (I understood well MM), but about the usage of the mt4 platform

canados
OK If you want to open a position for $10,000 you will need to select 0.10 in the options box (assuming you're in a micro account) which is 10x your basic lot size of 0.01. If your minimum lot size is 0.10 then you leave it as it is. See below (if I'm wrong someone will leap in here )

Quote
Standard Account:
1 Lot = $100,000, which requires $1,000 of capital @ 100:1
1 Pip = $10

MrMini Account:
1 Lot = $10,000, which requires $100 of capital @ 100:1
1 Pip = $1

Micro Account:
1 Lot = $1,000, which requires $10 of capital @ 100:1
1 Pip = 10 cents
Peter
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