Leverage ratio

The leverage ratio is position value divided by margin: ₹50,000 on ₹10,000 is 5x. One over the ratio is how far the price can move against you before the margin is gone: 20% at 5x, 5% at 20x, 2% at 50x. The Module 0 quiz turns a 2% index move into 20% of margin; leverage on Mochatrade.

Go on

In the help centreSee how leverage and margin work on Mochatrade
  • Initial margin vs maintenance marginInitial margin is the deposit to open a position; maintenance margin is the floor your account must stay above to keep…
  • Leverage in tradingLeverage is controlling a position bigger than the money you put up. At 5x, ₹10,000 of margin controls ₹50,000, so a…
  • 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…
  • Lot size and tick sizeLot size is how much one contract covers, like 100 troy ounces for COMEX gold or 1,000 barrels for WTI; tick size is…
  • Liquidation priceThe liquidation price is where the venue closes your leveraged position, computed from entry, leverage and margin…

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

Where it comes up