Leverage in trading

Leverage is controlling a position bigger than the money you put up. At 5x, ₹10,000 of margin controls ₹50,000, so a 2% move is 10% of your money and a 20% move against you is all of it. One 5x trade, start to finish; how leverage works on Mochatrade; and why leverage is the fourth number, not the first.

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In the help centreSee how leverage and margin work on Mochatrade
  • Margin tradingMargin trading is taking a position larger than your deposit, the margin. A US broker lends you cash at interest; on a…
  • Position sizingPosition sizing is deciding how much to trade: the rupees you are willing to lose divided by the distance from entry…
  • Buying powerBuying power is the position value your free margin can open at the allowed leverage: ₹20,000 at 10x is ₹2,00,000. It…
  • Liquidation / forced square-offLiquidation, or forced square-off, is the venue closing a leveraged position because the margin can no longer cover…
  • Mark priceThe mark price is the price a venue judges your position by, for unrealised profit and liquidation, built from the…
  • Isolated marginIsolated margin ties a fixed amount of margin to one position, so that position can only lose what you gave it and the…

Educational content only. Not investment advice. Leveraged products magnify losses as well as gains.

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