Risk and money
What is leverage in forex?
Leverage lets you control a big trade with a small deposit. It makes wins bigger and losses bigger by the same amount.
With 1:50 leverage, $1 in your account controls $50 in the market. A $2,000 deposit, called margin, can hold a $100,000 trade.
Leverage does not change how much a pip is worth. Your lot size does. Leverage only changes how much money must be set aside to open the trade.
Rules differ by country. In the United States, retail traders are limited to 50:1 on major pairs. In the European Union, the limit for retail clients is 30:1 on majors.
Margin for one standard lot
- 1One standard lot of EUR/USD at 1.1000 is $110,000.
- 2At 1:50 leverage, you divide by 50.
- 3Margin needed: $2,200.
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This is taught in Grade 4: Risk Camp.
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Reviewed 2026-10-04. Education only, not financial advice. Trading involves risk of loss.