DRAFT — demo educational content, to be validated by the owner
Leverage and margin
Leverage lets you open a position larger than the amount you deposit. With 1:30 leverage, $1,000 of margin lets you open a $30,000 position.
Leverage magnifies gains and losses in the same proportion. At 1:30, an adverse market move of just 3.3% is enough to use up all of the margin.
Margin is the amount set aside to keep the position open. If unrealized losses get too close to it, the broker may close the position on its own.
General educational content: it is neither investment advice nor a recommendation.