Which is better – high leverage ratio or low leverage ratio?
Since leverage allows you to use OPM (Other Peoples Money) then a high leverage places you in a riskier position. Although you are risking $500 you are also risking $24,500 at the 1:500. This puts you in a great position IF price goes up, but a worse position IF price goes down. So based on your trial success….have you done well? If so, purhaps the high rist would be good. However, when you jump in for real, things seem to be a little different. So depending on how much you can afford to lose…go high leverage…if you can’t afford to lose it….go low leverage…either way you hopefully will get a gain, but minimize risk with lower leverage. Then once you have got your feet a little wetter…move up to the higher leverage and risk. Good luck in your quest for risk. However, I think ONLY YOU can ultimately make that decision based on your experience. The advice you get here will only be as good as your interpretation of it.
