Forex and CFDs · Rookie
Leverage
What does Leverage mean?
Leverage creates market exposure larger than the capital required to support the position. Gains and losses depend on the exposure, not only the margin posted.
Example
A 20:1 relationship supports $20,000 exposure with $1,000 margin, subject to product rules.
Illustrative example; not a provider’s quoted offer.Why it matters for prop traders
Available leverage is a capacity limit, not a suggested position size or loss limit.
Sources and further reading
The following primary sources support the terminology. Provider rules describe their own products and may change.