How Do I Calculate Leverage in XAUUSD
Xauusd leverage is calculated based on a ratio. The ratio can be 100:1 or 50:1 or 10:1.
For 100:1 leverage ratio it means 1:100 leverage option means a trader can borrow $100 from their broker for every $1 dollar in their trading account, henceforth one with a deposit of $1,000 can borrow upto $100,000 from their broker - ($1,000*1:100 which is equivalent to $100,000). A trader can then use this borrowed capital to open trade transactions with.
For 50:1 leverage ratio it means 1:50 leverage option means a trader can borrow $50 from their broker for every $1 dollar in their trading account, henceforth a trader with a deposit of $1,000 can borrow up to $50,000 dollars from their broker - ($1,000*1:50 which's equal to $50,000). A trader can then use this borrowed capital to open trades with.
For 10:1 leverage ratio it means 1:10 leverage option means a trader can borrow $10 from their broker for every $1 dollar in their trading account, therefore a trader with a deposit of $1,000 can borrow upto $10,000 dollars from their broker - ($1,000*1:10 which's equal to $10,000). A trader can then use this borrowed capital to open trades with.
To Learn and Know More about Leverage & Margin - Read the Topics Below:
Leverage and Margin Described
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