What is Leverage & Lot Size And Margin in Forex?
What is Leverage in Forex?
A loan from your broker that support your account to open maximum lot size for trade is called leverage. many brokers provide different leverage like 1:3000 , 1:1000 , 1:500 , 1:100 etc.
What is Lot Size?
The number of currency units you will buy or sell that called lot size. in forex 4 types of lot size.
1:- Standard lot size
Standrad lot size equal to 100,000 currency unit.
2:- Mini lot size
Mini lot size equal to 10,000 currency unit.
3:- Micro lot size
Micro lot size equal to 1000 currency unit.
4:- Nano lot size
Nano lot size equal to 100 currency unit.
How to calculate the margin?
For example your broker leverage is 1:1000 and you want to open standard lot size for buy or sell.
Margin= Lot size/Leverage=100,000/1000=100 usd margin.
For example your broker leverage is 1:500 and you want to open standard lot size for buy or sell.
Margin= Lot size/Leverage=100,000/200=200 usd margin.
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