Bigger isn't always better. You can customise the size of leverage you're comfortable using on your trading account. You can start anywhere between no leverage and 500:1. Why wouldn't you go as big as possible? Because higher leverage means more opportunities but also higher risk. The leveraged account can turn against you if the market does. If you're unsure how to use leverage, read more about it in our Education Central or sign up to ask our customer support team.

Leverage is when you request debt from a broker to increase your trading power by a certain amount. This is done by lowering the margin blocked for one position, which makes more funds available for trading.

Leverage can help you magnify your trading balance and open up to more opportunities but remember, the higher the leverage, the greater the effect fluctuation has on your profits and losses. By multiplying the trading amount, you can potentially multiply your profits even from small market movements. However, trading with leverage should be combined with a risk-aware approach and strict money management, to minimize the possibility of large losses due to unexpected market movements.

You can use leverage to your advantage if you implement a well-thought-out risk management strategy. Risk management tools include margin call, stop out, take profit, stop loss orders, and position-sizing. Learn more about risk management and risk management tools in the EC Markets Trading Academy.