What is leverage?
Market Exposure Relative to Margin
Leverage allows traders to control a larger market position using a smaller amount of capital, known as margin.
It is commonly expressed as a ratio, such as 1:100. With 1:100 leverage, every $1 of required margin can provide exposure to $100 of market value, subject to applicable trading conditions.
CFD First offers leverage across available markets, subject to the instrument, account type and applicable conditions.
How does leverage work?
A 1:100 Leverage Example
Under this simplified example, $100 of margin would be required to open a $10,000 position at 1:100 leverage.
This example is for explanation only. Actual margin requirements depend on the instrument, account and current trading conditions.
Explore CFD First leverage
Published Account Leverage Levels
Leverage can vary across different instruments and account types.
| Account | Published leverage |
|---|---|
| CFD Edge | Up to 1:500 |
| CFD Plus | Up to 1:450 |
| CFD Standard | Up to 1:400 |
| CFD Prime | Up to 1:300 |
| CFD Signature | Up to 1:250 |
| CFD Infinity | Up to 1:200 |
Published maximum leverage is not guaranteed for every instrument or client. Availability depends on account type, instrument, jurisdiction and applicable conditions.
Leverage and margin
Directly Connected Concepts
Leverage
Determines the level of market exposure available relative to the capital required.
Margin
The amount of capital required to open and maintain a leveraged position.
Higher leverage can reduce the initial margin required for a position, but it also increases exposure relative to the capital committed.
Leverage increases both potential gains and losses
Understand the Full Exposure
Leverage does not change the underlying movement of a market. It changes the amount of market exposure relative to the margin used.
As a result, leverage can magnify both potential gains and potential losses. Clients should understand the leverage and margin requirements that apply to an instrument before opening a position.