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Why trade on margin?

Trading on Margin (Trading with Leverage) is a common attraction of the forex market. It allows you to open trades that are larger than the capital in your account.
 
Example

Why Trade on Margin

In the example above, $1,000,000 have been purchased through a long USD/JPY position with a $50,000 account balance (20:1 Leverage).

Trading on margin can both positively and negatively affect your trading experience as both profits and losses can be dramatically amplified. Trading foreign exchange with any level of leverage may not be suitable for all investors.