What is Leverage?

The use of borrowed capital to increase the potential return (and risk) of an investment.

In-Depth Explanation

Leverage allows you to control a large position with a small amount of capital (margin). In the UK, retail leverage is capped at 30:1 for major forex pairs by the FCA.

Practical Example

"With 30:1 leverage, you can control £30,000 worth of currency with a £1,000 deposit."

Related Terms

Margin Margin Call Drawdown

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