Leverage does not only add risk to your trading account, in addition it adds risk to the whole financial system. Just take a peek at what happened in 2008. Many well reputed banks went belly up in matter of days. How could it happen so quickly? Many of these banks have already been taking highly leveraged positions in the markets. When the markets turned, many of these banks suffered tremendous losses in matter of days and went bankrupt.
As a result, there’s a significant amount of oversight that matches leveraged strategies. The Securities and Exchange Commission, the US Treasury, the Commodity Futures Trading Commission and different exchanges in the US regulate how much money a trader can borrow. Many brokerage firms have even stricter rules in place within their risk management. Many of these firms follow the guidelines set by the National Association of Securities Dealers and the National Futures Association.
What this means is you do not have much flexibility whenever you borrow from your own broker to trade securities or currencies. Margin loans are highly regulated 마진거래 and you have to meet the terms of your broker. You brokerage firms make you sign a margin agreement that says that you recognize the risks and limits of your activities. You can’t have a margin account if you don’t have the absolute minimum amount in your account something like $10,000.
You will need to read the fine print of the margin agreement prior to starting trading on margin. If you will place a trade, you’d be asked if you should be trading with cash or margin. Clicking the margin box let’s you employ margin. It’s that simple but beware and know everything about just how to trade on margin before you actually do it.
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