Leverage & Margin
You can apply any trading strategies using chosen leverage with a minimal deposit with Vestrado. Choose wisely and trade safely
What is Initial / Required Margin?
Also known as the Initial Margin Requirement, the Initial Margin is the percentage of a financial instrument price that you, as the client, need to pay for with your own money. This requirement is basically the amount of collateral needed in order to open a margin position.
Required Margin or Margin Requirement refers to the amount you need in order to open and maintain a position, in addition to the initial loss that will occur due to the spread.
The Required Margin is derived from the following formula: (Amount * Instrument Price)/ Leverage + (Amount * Spread).
Example: trading 3 lots of EUR/USD using 1:200 leverage with an account denominated in USD, trade size: 300,000 and account currency exchange rate: 1.13798 would have a required margin of USD 1706.97 calculated by 300,000 / 200 * 1.13798 = $1706.97.
In Vestrado, all client are agree with our Leverage & margin Policy. Please read the policy here:
Leverage & Margin
Policy
Please read the Financial Instrument pages for more information on margin requirements for each instruments. Vestrado allows clients to choose the leverage of their accounts ranging from 1:300 to 1:2000
With a small deposit, you can use any trading strategy with the leverage of your choice. Make wise decisions and trade responsibly.
Base on Notional Value | Leverage on Frux Standard Account | Leverage on Fides Cashback Account | Leverage on ECN Respectus Account | Leverage on Economic News |
|---|---|---|---|---|
0 – 100000 | 1 : 2000 | 1 : 1000 | 1 : 1000 | 1 : 1000 |
100000 – 300000 | 1 : 1000 | 1 : 1000 | 1 : 1000 | 1 : 500 |
300000 – 1000000 | 1 : 500 | 1 : 500 | 1 : 500 | 1 : 300 |
1000000 – 2000000 | 1 : 200 | 1 : 200 | 1 : 200 | 1 : 100 |
2000000 – 3000000 | 1 : 100 | 1 : 100 | 1 : 100 | 1 : 100 |
3000000 – 5000000 | 1 : 50 | 1 : 50 | 1 : 50 | 1 : 50 |
5000000 and above | 1 : 5 | 1 : 10 | 1 : 5 | 1 : 10 |
* Vestrado reserves to apply changes to and amend the leverage ratio. Please read our Terms & conditions
* Please read our trading execution risk policy under margin calls to get a clear example of how it will work with margin requirements and client equity when trading with high leverage.
Frequently asked question
Dynamic leverage refers to a type of leverage that automatically adjusts to the size of a trader’s position. In this system, the amount of leverage used is based on the notional value of the trade, rather than a fixed leverage ratio.
For example, suppose a trader wants to buy a currency pair that has a notional value of $100,000. If the trader has a dynamic leverage system in place and the leverage ratio is set at 1:100, the trader would only need to provide $1,000 of margin to open the position. If the position moves in the trader’s favor and the notional value increases to $200,000, the leverage ratio would automatically adjust to 1:50, meaning that the trader would now need to provide $4,000 of margin to maintain the position.
Dynamic leverage can be beneficial because it allows traders to adjust their leverage automatically as the size of their positions change, which can help them manage their risk more effectively. However, it’s important to note that leverage can also increase risk, and traders should be careful to use it wisely and within their risk tolerance.
Notional volume refers to the total value of a financial instrument or trade, typically expressed in the currency of the underlying asset. For example, in forex trading, the notional volume of a trade would be the size of the position in the base currency, multiplied by the exchange rate.
For example, if a trader buys 100,000 units of the EUR/USD currency pair at an exchange rate of 1.20, the notional volume of the trade would be 100,000 * 1.20 = 120,000 EUR. This represents the total value of the trade in EUR, even though the trader may only need to provide a small amount of margin to open the position.
Notional volume is an important concept in financial markets because it helps to determine the size and risk of a trade. It is often used in conjunction with leverage to calculate the margin requirements for a trade and to assess the potential risk and reward of a position.
Leverage can be affected by economic news because the news can have a significant impact on the market, which can in turn affect the value of a trader’s position. When economic news is released, it can cause market prices to fluctuate, potentially resulting in changes in the value of a trader’s position.
For example, if a trader has a leveraged long position in a particular asset and there is a negative economic news release, the value of the position may decrease, resulting in a margin call. If the trader doesn’t have sufficient margin to cover the loss, the broker may close the position to minimize the risk of further loss.
On the other hand, if the economic news is positive and the value of the trader’s position increases, the leverage may also increase, allowing the trader to potentially increase their potential profit.
It’s important to note that leverage can be a powerful tool for traders, but it can also increase risk. As such, traders should be aware of the potential impact of economic news on their positions and be prepared to adjust their leverage accordingly to manage their risk.