What is 200 1 on Forex trading and is there any difference between it and 100 1?

To put it simply, leverage is financing is borrowing money, you don't have so much money to speculate and borrow money from market makers, and the principal is used as collateral, once the floating loss exceeds the principal, it is a liquidation.

The lower the margin ratio, the higher the leverage. The same amount of money can buy more goods, the impact of market fluctuations is naturally greater, and the risk is higher.

If the margin used to buy 1 lot of EUR USD is $100, you have a principal of $100 in your account, and if the account leverage is $100, then you can trade 1 lot with a fluctuation of $10; If your account leverage is $1:200, then you can trade 1 lot with $50, and a fluctuation of one pip is $10; The conclusion is that the higher the leverage ratio, the less margin we use, and the more hands under the same account principal, but the less anti-risk; On the contrary, the leverage ratio is low, the more margin used, the less the number of lots, the greater the risk resistance.

In this way, 100,000 times 100 times = 1,000 US dollars, 100,000 times 400 times = 250 US dollars, that is to say, to make 1 standard contract, if it is 1:100 leverage, you need to use 1,000 US dollars of your account funds, if it is 1:400 leverage, you need to use 250 US dollars of your account funds.

So how much money is still active in your account? How much risk can it resist?

For example, take the account capital of 6,000 US dollars and buy 1 euro US dollar as an example (10 US dollars per point): 1:100 times leverage:

Occupy $1,000 of funds, and there are $5,000 in the account that are active, which can resist the risk of 500 points, and when the market ** fluctuates upward and loses 500 points, a margin call occurs, and the system will force you to close the position. (Average risk) 1:400 times leverage:

Occupy $250 of funds, and there is $5750 in the account that is active, which can resist the risk of 575 points, and when the market ** fluctuates upwards and loses 575 points, a margin call occurs, and the system will force you to close the position. (The risk is small compared to 1:100 leverage) from which we can draw the following conclusions:

Under the condition of the same funds in the account, the same number of lots (1 contract is called 1 lot), the higher the leverage ratio, the smaller the risk of margin call! At the same time, it should be noted that if the leverage is high, the margin occupied by each order is small, and it may not be able to control the more orders, so the risk will increase.

For example, if you place an order with 100 times leverage in a $10,000 account, the margin is 1,000, the remaining margin is $9,000, and the profit or loss is $10 for every one point fluctuation in the 4 decimal places.

The same is a $10,000 account with 500 times leverage ratio under 5 lots of orders, occupying margin of 1,000, the remaining margin of $9,000, and a profit or loss of $50 per point fluctuation in 4 decimal places.

That is to say, if you spend the same money, the margin that you can tolerate is 9,000 US dollars, and 100 times 1 lot order can withstand 900 points of loss, and 500 times 5 lot orders can only bear 180 points. Of course, if you place 1 lot of orders, it is more suitable to be 500 times, because he occupies less margin. Therefore, there is a lot of money that can withstand fluctuations.

Conclusion: The size of the leverage is related to the trading volume you place, and your leverage has nothing to do with it, the leverage is only related to the margin, in the actual current foreign exchange market of many profitable investors, the real leverage should not be too large, because the position is too heavy and easy to get lost. But the smaller the better, because then it would lose the meaning of foreign exchange margin trading to be small and large.

The correct investor forex margin trading leverage should be selected in multiples.

In the case of large fluctuations in foreign exchange transactions and a large amount of principal, large leverage is used;

The principal amount < 100,000 US dollars and 100 times leverage is enough, that is, 100:1

Principal" is $100,000, and you can choose 200 times leverage, that is, 200:1

1:200 1:100 to be exact if you're using an American platform. Then there is no 1:200. It's British, it's pretty much the same.

100:1 and 200:1 on foreign exchange, mainly talking about leverage, the size of the leverage directly affects the margin (prepayment), the same is 1 lot of EURUSD order, fluctuating one point and two leverages are 10 US dollars.

Current EURUSD:

For an account with multiple leverage (100:1) to make 1 lot of short order, the margin (prepayment) is 1230 USD;

For an account with multiple leverage (200:1) to make 1 lot of short order, the margin (margin) is 615 USD.

Margin ratios don't have much effect on all investors. The profit and loss is only related to the number of lots traded: 1 lot fluctuates by one pip and the profit or loss is $10.

100 times 200 times 400 times leverage, the profit and loss of 1 lot is 10 USD. It only plays a role in fighting big with a small one, and the risk still lies in the control of the investors themselves. If someone really operates with a full position, it must not be far from liquidation.

If you don't stop the loss, causing the account to approach the limit of the margin ratio, it is not far from liquidation. It is the lot size that is controlled to trade: 1000 USD allows you to trade in US dollars.

Maintaining this ratio is king.