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Leverage

Leverage in forex trading means you can increase the amount that you want to invest by using “borrowed” money from the broker. For example, if your broker provides you with a 1:500 leveraging ratio, this mean with $1000, you can make an investment equivalent to $500,000 ($1000 x 500). It is only in the forex trading industry that a trader can increase his investment capital by a factor of several hundred times.