Free Leverage Calculator - Determine Optimal Trading Leverage

Beginners should start with low leverage (2:1 to 5:1) to learn risk management. High leverage like 100:1 can wipe out accounts quickly. Start conservative and increase gradually as you gain experience and develop consistent profitability.

Leverage amplifies both gains and losses equally. With 10:1 leverage, a 1% market move becomes a 10% account move. While profits increase, losses also multiply by the same factor. Always calculate your maximum loss before entering any leveraged position.

Leverage is the ratio (e.g., 10:1), while margin is the deposit required (e.g., 10% for 10:1 leverage). If you want to control $10,000 with 10:1 leverage, you need $1,000 margin. Our calculator shows both values for complete clarity.

Most brokers don't allow leverage changes on open positions. You must close the position and reopen with new leverage. Some platforms offer position modification tools, but this varies by broker. Always check your platform's specific rules.

Leveraged positions can face margin calls if losses approach your margin requirement. If you can't add funds, the broker may force-close your position to limit further losses. This is why proper risk management is crucial with leverage.

Optimal leverage depends on your risk tolerance and strategy. Conservative traders use 2:1 to 5:1, active day traders might use 10:1 to 20:1, but never exceed what you can afford to lose. Use our position sizing calculator to determine safe leverage levels.