Gold Trading Leverage Definition in Trading Gold
Leverage Meaning in XAUUSD Trading
The best gold Trading leverage to use is 100:1 leverage ratio. This is the leverage ratio in gold trading that is also used by experienced xauusd traders.
For $100 Gold Trading Account Equity
With 1:100 leverage ratio when you open an account with $100 you'll have trading capital of $10,000 to open xauusd trades with - with 1:100 leverage it means your gold broker gives you 100 dollars for every 1 dollar that you have in your xauusd trading account. Therefore, if you've 100 dollars - 100*1:100 Leverage is equal to 10,000 that you can trade with.
In Gold Trading with $100 you can control $10,000 capital to trade gold with after leverage of 1:100
For $500 Gold Trading Account Equity
With 1:100 leverage ratio when you open an account with $500 you'll have trading capital of $50,000 to open xauusd trades with - with 1:100 leverage it means your gold broker gives you 100 dollars for every 1 dollar that you have in your xauusd trading account. Therefore, if you have 500 dollars - 500*1:100 Leverage is equal to 50,000 that you can trade with.
In Gold Trading with $500 you can control $50,000 capital to trade gold with after leverage of 1:100
For $1,000 Gold Trading Account Equity
With 1:100 leverage when you open a trading account with $1,000 you'll have trading capital of $100,000 to open xauusd trades with - with 1:100 leverage ratio it means your gold broker gives you 100 dollars for every 1 dollar that you have in your xauusd trading account. Therefore, if you have 1,000 dollars - 1,000*1:100 Leverage is equivalent to 100,000 that you can trade with.
In Gold Trading with $500 dollars you can control $100,000 capital to trade gold with after leverage of 1:100
What's the Best Leverage to use when gold Trading? - 100:1 Leverage ratio
For $2000 Gold Trading Account Equity
With 1:100 leverage when you open an account with $2000 you'll have capital of $200,000 to open xauusd trades with - with 1:100 leverage ratio it means your gold broker gives you 100 dollars for every 1 dollar that you have in your xauusd account. Therefore, if you have 2000 dollars - 2000*1:100 Leverage is equal to 200,000 which you can trade with.
In Gold Trading with $2000 you can control $200,000 trading capital to trade gold with after leverage of 1:100
Limitations of Leverage - XAUUSD Leverage Ratio - Leverage Meaning in Gold Trading
The more leverage you use greater the profits or losses
less leverage you use lesser the profit or loss
It is therefore better to use less leverage so as to minimize risks involved. The higher the leverage ratio used the higher the risk. This is one of the Gold Trading leverage rules not to trade with more than 5:1 leverage.
In Gold Trading money management guidelines: It is always advisable to stay below 10:1 leverage ratio which is still high, most professional traders use 2:1 leverage ratio meaning they trade only 2% of their Gold Trading Account.
To Know More about Gold Leverage & Margin - Read the Learn Gold Trading Below:
Gold Leverage & Gold Margin Described
