Leverage

Forex investors are permitted to trade foreign currencies on a highly leveraged basis - up to 100 times their investment. For example, an investment of $1,000 would permit a trade up to $100,000 of any particular currency. A small margin deposit can control a much larger total contract value. Leverage gives the trader the ability to make extraordinary profits and at the same time keep risk capital to a minimum. Please note that increasing leverage may also increase losses.