Trading Leverage

[Zigabel]

In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal. It messes things up for both the traders and the market. So my question is why do exchanges still offer them. They keep pushing it to traders like favourite snack?

I dis agree with you, you can't totally put out leverage just like that, leverage isn't bad in it's totallity and cannot be seen as such but over leveraging is what actually turns to be a bad way of trading, do you know without leverage you cannot be able to trade as a retail trader, it's because of the leverage offered you by the broker you are able to trade your small $50 account and move it to $100 and above , if there were no leverage you will need much more than that to be able to trade the market which i know as a retail trader you may not be able to have that much and willing to risk it all on a single trade, because if you loose such trade then all your funds will be gone but when you bare leveraging you will be able to maintain some balance even after loosing a trade or two.

Understanding the concept of leveraging would have helped you better put your post but then you probably didn't understand the difference between leveraging and over leveraging and that's why you taught leveraging is totally bad of which that's not completely true as some persons have benefited so we'll leveraging which has helped them achieve greater heights trading than they would have if they were to wait till they are able to gather the appropriate amount needed to get a position on a trade.

[justdimin]

In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal. It messes things up for both the traders and the market. So my question is why do exchanges still offer them. They keep pushing it to traders like favourite snack?

I dis agree with you, you can't totally put out leverage just like that, leverage isn't bad in it's totallity and cannot be seen as such but over leveraging is what actually turns to be a bad way of trading, do you know without leverage you cannot be able to trade as a retail trader, it's because of the leverage offered you by the broker you are able to trade your small $50 account and move it to $100 and above , if there were no leverage you will need much more than that to be able to trade the market which i know as a retail trader you may not be able to have that much and willing to risk it all on a single trade, because if you loose such trade then all your funds will be gone but when you bare leveraging you will be able to maintain some balance even after loosing a trade or two.

Understanding the concept of leveraging would have helped you better put your post but then you probably didn't understand the difference between leveraging and over leveraging and that's why you taught leveraging is totally bad of which that's not completely true as some persons have benefited so we'll leveraging which has helped them achieve greater heights trading than they would have if they were to wait till they are able to gather the appropriate amount needed to get a position on a trade.

I think the reality is that Leverage is done by people who do not understand the risk that is involved a lot, and that is why a lot of people are fully against it. There aren't that many things in the investment world where you can lose 100% of your investment, sure there could be some drops, like for example if you had bitcoin in the past month, you had a drop right? But not 100%, whereas in leverage trading you could lose 100% of your investment and that is what people are fearing right now as well.

That is why I understand that it may not feel like something you could do without much trouble. I personally believe that the best thing we could do with this would be avoiding Leverage, because that is the simplest solution.

[Cryptomultiplier]

One thing I know about using leverage in trading from the ones I have seen is that, it acts as an amplifier for any loss or profit made while using it as a method to trade with.

It isn't an advised method for newbie traders to use, because it could mess up their minds emotionally when they make losses and that's a multiple of the amount they initially locked in to trade.

For those who have some experience trading already, am sure you are aware that there's a recommended leverage for the amount in ones account to be traded with, and for an  Account with about $10 - $50 in it, the recommended Leverage to use would be about 1:100 or lower.
Also, an account having about $100 - $200 will have to follow a recommended Leverage in the ratio 1:200 or lower still.

The risk is as high as the reward while using leverage in trading and it's not advised to use borrowed funds or money intended for good use to trade leverage, because any loss might be hard to recover from.

[batang_bitcoin]

That is why I understand that it may not feel like something you could do without much trouble. I personally believe that the best thing we could do with this would be avoiding Leverage, because that is the simplest solution.

I have been avoiding trading in futures and have never done leverage anymore. I don't feel that I can do it and it's just best for me to stay in the spot and I am more free to move with it. Compared in doing futures, you need to be active at most times. You'll be surprised by the market's motion and you're not prepared when it suddenly falls down or it suddenly gotten up and it's the opposite on how you leverage your trade and no doubt you'd be liquidated with that.

[Russlenat]

That is why I understand that it may not feel like something you could do without much trouble. I personally believe that the best thing we could do with this would be avoiding Leverage, because that is the simplest solution.

I have been avoiding trading in futures and have never done leverage anymore. I don't feel that I can do it and it's just best for me to stay in the spot and I am more free to move with it. Compared in doing futures, you need to be active at most times. You'll be surprised by the market's motion and you're not prepared when it suddenly falls down or it suddenly gotten up and it's the opposite on how you leverage your trade and no doubt you'd be liquidated with that.

Trading with leverage is never an ideal one for those traders who want to avoid trading at high risks. It’s still best to trade at your own risk, without putting so much stress and pressures in your own trades. However, while this one gets avoided by regular traders, still there are those who manage to trade using leverage in trading. That’s because there is always an advantage for those who are obviously good traders, as they can certainly increase their potentials to make huge, satisfying profits.

[batang_bitcoin]

That is why I understand that it may not feel like something you could do without much trouble. I personally believe that the best thing we could do with this would be avoiding Leverage, because that is the simplest solution.

I have been avoiding trading in futures and have never done leverage anymore. I don't feel that I can do it and it's just best for me to stay in the spot and I am more free to move with it. Compared in doing futures, you need to be active at most times. You'll be surprised by the market's motion and you're not prepared when it suddenly falls down or it suddenly gotten up and it's the opposite on how you leverage your trade and no doubt you'd be liquidated with that.

Trading with leverage is never an ideal one for those traders who want to avoid trading at high risks. It’s still best to trade at your own risk, without putting so much stress and pressures in your own trades. However, while this one gets avoided by regular traders, still there are those who manage to trade using leverage in trading. That’s because there is always an advantage for those who are obviously good traders, as they can certainly increase their potentials to make huge, satisfying profits.

Yes, it's not. But there are risk takers that wanted to do it because they think that it's going to be helpful to them and will make them rich quickly. They don't know how many times those successful traders on it have done and took a lot of losses before they're able to make it.
It sounds easy and chill but to be honest, it's not really ideal for everyone and only a few should do it. But hey, everyone has got money to trade so no one is going to stop them until they realize that it is not for them.

[Adbitco]

Do you think everyone makesl lose I think only those who aren't knowledgeable enough to know what they are doing keeps calling into prey for this, Thus if you don't make profit doesn't mean others aren't making profit and between, your lose is profits for the market or to another trader while your profits is another traders lose there the market is known to be called " survival for the fittest" if you aren't strong and smart enough you would keep losing.

[mirakal]

In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal.

The other trader who made massive profits on the otherside would disagree. It's not a bad deal to them. What is a bad deal is your poor trading decision. The money makes it's way to the smart traders from those who made poor decisions. That's how markets work.

The exchanges mostly benefit from the trading fees from all traders using their platform.

It only gets bad if you are struggling in trading, but if you have high experience and gained sufficient knowledge in trading, you will definitely look at leverage as a bigger opportunity to chase higher potential profits. That’s why we have seen lots of traders still want to learn and suicide in using leverage, because they all know it can make your trading instantly massive.

On part of the exchanges, the fact that they are getting substantial profits from it, surely they will continue to attract traders to try trading with leverage. At the end of the day, your decision will still be greatly influenced with your trading preference.

[GreatArkansas]

In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal. It messes things up for both the traders and the market. So my question is why do exchanges still offer them. They keep pushing it to traders like favourite snack?

Trading itself is already risky, even without any leverage, it's already risky.
Trading with leverage is like the next level of trading where the risk is higher but the rewards are high also.

So for me, we must not blame exchanges here because at the end of the day, it will be up to us if we trade with leverage or not.

[OcTradism]

Trading itself is already risky, even without any leverage, it's already risky.
Trading with leverage is like the next level of trading where the risk is higher but the rewards are high also.

So for me, we must not blame exchanges here because at the end of the day, it will be up to us if we trade with leverage or not.

Without leverages, people can lose nearly all money if they bought Terra LUNA token in 2022 Terra and UST crash. The death spiral of Terra and its algorithmic stable coin can kill any trader even no leverage is used.

That is a big lesson and can be used as a reminder that "Only trade with money you can afford to lose it at any cost" because in trading, black swan event can occur anytime.

Risk is bigger with altcoins and very fortunately, if you pick Bitcoin, you can reduce risk from trading. With Bitcoin, no algorithm that can trigger a death spiral like LUNA and its algorithmic stable coin UST.

[God bless u]

In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal. It messes things up for both the traders and the market. So my question is why do exchanges still offer them. They keep pushing it to traders like favourite snack?

The simplest answer to this is that I think leverage is the best way to earn good profits. I'm talking about the profits that exchanges earn by charging fees on your trades. When you open a trade an amount of fees according to leverage set is charged by the exchanges and that's why they're offering them.

Leverage is best for the platforms offering them but it's worst for both the trader and the coin that is being traded on. But due to the factor of greed people take a punt and these kinds of people don't want to listen to anyone until and unless they lose a heavy amount of money.

[shinratensei_]

Do you think everyone makesl lose I think only those who aren't knowledgeable enough to know what they are doing keeps calling into prey for this, Thus if you don't make profit doesn't mean others aren't making profit and between, your lose is profits for the market or to another trader while your profits is another traders lose there the market is known to be called " survival for the fittest" if you aren't strong and smart enough you would keep losing.

right? leverage exist for a reason, people with small capital wanted to have that opportunity to turn their peanuts capital into some good profit, because imagine trading $10 it will take years before you can even make profit that without even taking into account the fee, with leverage such as 25x the capital easily becomes big, the problem that most of people have with leverage trading is that they think they should just go big with their capital and leverage it, thats in its own isn't really true, people can just use small capital with high leverage just to test out the market.

the leverage feature also not enforced to the people anyway it just to give the opportunity for people that are so sure with their trading strategy.
even in stocks and forex there are leverage so its not really a feature that is alien to most of us here, i think leverage can work so good if combined with great strategy.
but i can also be double edged swords too so it depends like many have stated don't blame exchange for providing features.

[synchronym]

There are many newbies who don't have enough knowledge about trading and it's not right to bother with levers. Those who are new to trading must first gain enough knowledge about trading if you don't know enough about trading then you will never get success through trading so first you need to know enough about trading and gain knowledge then start trading. Of course you have to have a long term plan before trading. If you can keep a long term plan and check the market in trading then you can definitely get success through trading.

[Essential10]

There are many newbies who don't have enough knowledge about trading and it's not right to bother with levers. Those who are new to trading must first gain enough knowledge about trading if you don't know enough about trading then you will never get success through trading so first you need to know enough about trading and gain knowledge then start trading. Of course you have to have a long term plan before trading. If you can keep a long term plan and check the market in trading then you can definitely get success through trading.

Naturally those who are new must have less knowledge in the trading sector. But among those who are new to trading, those who have money and don't mind losing it can move forward first. On the other hand those who are new to trading even though they have little capital but that is their only capital then they lose money in the initial stage and lose confidence from trading. Personally I think only a long term plan, patience, time, skill acquisition are part of learning to trade but of course you need to practice and gain experience with money. So if all the above are perfected you will go to a stage and get success in trading.

[tvplus006]

The simplest answer to this is that I think leverage is the best way to earn good profits. I'm talking about the profits that exchanges earn by charging fees on your trades. When you open a trade an amount of fees according to leverage set is charged by the exchanges and that's why they're offering them...

If only the exchange made a profit from using leverage, then there would be no traders who would use it. So it is beneficial not only for the exchange, but also for the trader, who can get additional profit thanks to leverage.

[Eternad]

In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal. It messes things up for both the traders and the market. So my question is why do exchanges still offer them. They keep pushing it to traders like favourite snack?

Leverage is never a bad feature because it helps trader with low capital to borrow more capital for their trade in exchange for the risk of liquidation which scalable depending on the amount of leverage which traders will use.

You will never encounter a serious problem on leverage if you use it properly and avoid using high leverage on a very volatile assets. There’s also a stop loss feature that will save you from severe losses on case the markets doesn’t move according to your trading plan.

Overall, leverage is a handy trading tool if you knew how to use it properly.

[poodle63]

The simplest answer to this is that I think leverage is the best way to earn good profits. I'm talking about the profits that exchanges earn by charging fees on your trades. When you open a trade an amount of fees according to leverage set is charged by the exchanges and that's why they're offering them...

If only the exchange made a profit from using leverage, then there would be no traders who would use it. So it is beneficial not only for the exchange, but also for the trader, who can get additional profit thanks to leverage.

it does indeed 100% helpful when we are short of capital but want to make big trade anyway, instead of just stuck with low capital and make all the profit got eaten away by the fee due to the fact that if we have low capital we might need to try find opportunities between price movements, with leverage we can get good profit so long we are so sure that the market gonna be turning like what we've predicted then we might get good amount of profit with just low capital alone.
it is helpful for those that can take advantage of the feature but might be a disaster for people that are greedy only thinking about profit they gonna get not thinking about the loss they might endure due to irresponsible use of the leverage feature.
overall its indeed helpfuil.

[Hamza2424]

There are many newbies who don't have enough knowledge about trading and it's not right to bother with levers. Those who are new to trading must first gain enough knowledge about trading if you don't know enough about trading then you will never get success through trading so first you need to know enough about trading and gain knowledge then start trading. Of course you have to have a long term plan before trading. If you can keep a long term plan and check the market in trading then you can definitely get success through trading.

Hmm, well bro the fact is people just don't pick up the things, because as you know in talking about something and executing something there comes a huge difference, and 70% + people fail in execution about what they commit.

TBH, Newbies these days follow YouTube influencers and their primary motive is always to sell the premium signal group courses, newbies fall into the profit screenshots of those influencers, people believe in them because many people are following them but they are now aware of the reality that most of those people are thinking in the same way as they are. Who will not get attracted to their marketing strategy that one user joined today and made 1000 bucks and they don't know how much he invested if a person who invested and took a $100k trade with his 5k investment on 20x and made 1k out of what's the big deal in the this in the bull run 10% to 30% profit is not a big deal in the bullish crypto market. 

[crwth]

You know that it depends on the situation. You can take advantage of being able to have more capital in a trade when you are doing that. It would just depend on the risk management that you have and you should take it with full consciousness so you could take advantage of the situation. It's more likely to push yourself in a way to boost possible earnings but it can be a double-edged sword as well.

Can you pinpoint how exchanges "push" it towards traders? Mostly it's unlockable if you agreed to some warnings that it's dangerous if it's not done with caution.

[Etranger]

There are many newbies who don't have enough knowledge about trading and it's not right to bother with levers. Those who are new to trading must first gain enough knowledge about trading if you don't know enough about trading then you will never get success through trading so first you need to know enough about trading and gain knowledge then start trading. Of course you have to have a long term plan before trading. If you can keep a long term plan and check the market in trading then you can definitely get success through trading.

This is definitely a less risky path, but unfortunately, or fortunately, who knows, many things can only be learned through experience. Even more: from one`s own experience. You can be an incredibly successful trader a thousand times on paper or on a test account, but until you start trading with your real deposit, you won’t know much about yourself. And this knowledge directly affects the trading result.