What is the maximum leverage in forex?

Maximum leverage varies by region. The US limits leverage to 50:1 for major pairs, Europe caps it at 30:1 for retail traders, while some offshore brokers offer up to 1:500 or higher.

Why is leverage called a "double-edged sword"?

Because it amplifies both profits AND losses equally. The same leverage that could double your account can also wipe it out with the same size market move in the opposite direction.

What happens when you get a margin call?

A margin call occurs when your account equity falls below the required margin level. Your broker will either demand additional funds or automatically close some or all of your positions to prevent further losses.

Can I lose more than I deposit with leverage?

Yes, it's possible during extreme volatility. However, many regulated brokers in Europe and elsewhere now offer "negative balance protection" that limits your losses to your deposited funds.

What leverage should beginners use?

We recommend beginners start with 1:10 to 1:30 leverage. This provides enough buying power while leaving room for error as you develop your trading skills.

Forex Basics

Forex Leverage Explained: Risks and Benefits

Understand how forex leverage works, the relationship with margin, and best practices for using leverage responsibly. Essential reading for all traders.

Written BySarah ChenSenior Financial Analyst

Fact Checked ByJames AndersonChief Editor & Lead Analyst

Last UpdatedOct 22, 2026

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Sarah Chen

Fundamental Analysis • Macroeconomics • Currency Trends

About the Author

Sarah brings 12 years of Wall Street experience, having worked as a senior currency analyst for top-tier hedge funds. Her expertise lies in fundamental analysis and macroeconomic trends affecting global currency markets. She heads our broker verification process.

Senior Financial Analyst — Everything you find on BrokerAnalysis is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback.

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