What is the meaning of leverage?
Leverage in trading is like using borrowed money to boost your investment 📈! It lets you control a bigger position with a smaller amount of your own cash.
*How Leverage Works:*
- You borrow funds from a broker (like Binance) to increase your trading power
- If the trade goes your way, profits are amplified
- But if it goes against you, losses are also bigger
*Example:*
- You have 1 BTC and want to trade 3 BTC worth of Ethereum
- With 3x leverage, you borrow 2 BTC and control 3 BTC worth of ETH
- If ETH goes up 10%, your profit is 3x bigger (but so are potential losses)
*Risk Note:* Leverage can boost gains, but also increases risk of big losses. Use it wisely 💡!
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