Leverage allows traders to control larger positions in the market with a smaller amount of capital. While it increases the potential for profit, it also significantly amplifies risks. If the market moves against your position, your losses can quickly exceed your initial investment. One key consequence of improper leverage use is the risk of receiving a margin call.
Leverage Risks

Amplified Losses: While leverage enhances potential profits, it also magnifies losses. For example, with 10:1 leverage, a 1% move against your position results in a 10% loss relative to your capital. If the market moves sharply, losses can escalate quickly, potentia...