Leverage trading: Is it safe?

Margin trading is the real key to getting rich quickly, but it can also be the road to ruin. To succeed in trading margins, it is important to have knowledge of what we should mention here.

Leverage trading: Is it safe?
15. April 2024 by Web Money Guy / Moneyspinner

The EASIEST system to make money online? Well that depends, but this is hands down the best we have found so far: Best method to make money online right now...

Trading on margin means that you can have a position far greater than your capital implies. For example, you can buy CFDs in currency worth 50,000 million with only 1.000 million.

Here are some important concepts to understand margin trading:

Maintenance Margin

Maintenance Margin is the amount you should have provided your client with your online broker. If you are giving a margin position open, you must make sure that your balance on your account is less than the requirement for maintenance margin. Your online broker will state the requirement for maintenance margin for each trade you make on margin.

It is also important to note that the rule is different maintenance requirements margins depending on the financial instrument you act in. The maintenance margin requirement for CFD trading may be something completely different than trading in stocks, currencies or ETF trade.

Initial Margin

Initial Margin requirement is the account balance for you to open a new position. Your broker has different requirements for initial margin and you should familiarize yourself with the requirements that apply in your online broker before you begin with margin trading.

Margin call

If you are holding an open position, and the balance is below the minimum maintenance margin, your online broker to perform a forced sale - a margin call - thus closing your position.

Example margin call:

Has 1,200 dollars on your client. So you decide to buy 1:10 CFDs Coca Cola to 1080 dollars. You have successfully purchased 10 x 1080 = 10,800. Let us further assume that your online broker has an initial margin of 10% and the maintenance margin requirement of 5%, and in this case it means that is 5% of 10,800 is 540 million. You need 540 million in funds in your account to keep the position open. If your position falls below this level, shut it.

Great ways to make money online in 2024
(Try it today. Start earning tomorrow!)

  • Sell your photos online and get paid! This has got to be the easiest method of making great extra money for almost zero effort. Just start uploading your best photos and start earning from millions of potential buyers. Greatest opportunity, really recommended!
  • Dropshipping is one of the best ways to earn colossal amounts of money online, really. Like any online business it will not be running itself, but you could start earning money from wholesale suppliers and before you know it profit from selling products you don't even own.

Sell The Most Profitable Products Ever Start Selling Online With SaleHoo

Ways to make money online

How to make money online

Make Money on the Internet with our easy tips. All you need is some time available and you can start right now. The web is wonderful and a gold mine for those who know how to create online income.

How to make money blogging

How to make money blogging

Many have their own blog, but they do not know how to get good income on the blog. How to earn money blogging?

Get rich on dropshipping?

Get rich on dropshipping?

Dropshipping is a simpler form of import, but that makes it possible to earn at least as much money on a traditional import business. Read about a new and ingenious way to make money online.

Paid surveys is not a scam

Paid surveys is not a scam

On the internet it is possible to attend so-called paid surveys. Although there do exist survey websites that are into scamming people, there are also a handful legit ones.

Freelancing & outsourcing

Freelancing & outsourcing

The perfect way to make money must surely be to hire a freelancer to do the job. Outsourcing is called. Outsourcing is an ingenious way to make money, if you choose the right tactics.