Amplifying Profits- A Deep Dive into Leveraged Trading -- Crypto, Stocks, Forex

Decentralised News

Welcome to our deep dive into one of the most powerful, yet often misunderstood, tools in trading: Leverage. In this insightful video, we're breaking down the concept of leverage and revealing how traders can use it effectively to amplify their profits.

Transcript

00:00what's up guys welcome back to decentralized news in today's video i want to just explain

00:06leverage and how to use leverage in a very um sort of smart way when you're trading because

00:14leverage can be a powerful tool to help you actually unlock a real good returns but if you

00:20don't use it appropriately you can lose a lot of money as well and i know on crypto youtube there's

00:26a lot of influencers that really promote leverage trading platforms without really giving you the

00:31basics of how to use it effectively so that you can also protect your capital so let's talk about

00:38first how to understand leverage and also leverage in different markets i'll just talk about leverage

00:45in futures and the crypto market for example and we can talk about the risks and rewards and some

00:50of the key considerations and so if you like this kind of content make sure you hit that like

00:56button subscribe to the channel don't forget to go to our main site centralized.news and you'll be able

01:02to get the best cryptocurrency exchange reviews leverage trading platforms included and a whole

01:08lot more information so let's talk about how you guys should be looking at leverage leverage is in

01:15trading specifically actually just refers to the practice of using borrowed funds to increase your

01:22potential returns on an investment so essentially it allows you as a trader to control larger positions

01:27with a small amount of capital leverage is also expressed as a ratio for example a leverage of 10 to

01:341 means that for every dollar of your own money you can trade with 10 dollars so when we look at

01:42leverage in different markets largely it's uh used a little bit differently depending on the markets

01:48so in the stock market leverage can be achieved through margin trading okay so this is a situation

01:54where you'd borrow money from a broker in order for you to purchase stocks and then the securities in

02:00your portfolio serve as the collateral for that loan in the forex market uh it is known as high leverage

02:07ratios where sometimes it's 100 to 1 and this means that with a thousand dollars a trader can control a

02:15position with about a hundred thousand dollars and such leverage is uh possible due to the small

02:21fluctuations in currency exchange rates so in the futures and options market you have um leverage but

02:30this is when you buy a futures contract typically you agree to buy and sell a certain asset uh at a future

02:36date for a specific price and options on the other hand give you the right but not the obligation to

02:42actually buy and sell an asset at a set price and you can have leverage in these sort of situations as

02:48well so in the cryptocurrency market many exchanges use trading or offer leverage trading and given the

02:56volatility of cryptocurrencies this can be particularly risky if you're using large amounts of leverage okay so

03:02the primary advantage if we want to talk about the risks and rewards of using leverage is uh that you

03:08know uh you can boost your profits significantly if you're using leverage uh and then the price of an

03:14asset let's say moves in the direction that you predicted your returns are multiplied but also this

03:20is a double-edged sword like we said it can also magnify your losses if the market moves against you you could

03:26lose more than your actual initial investment this is why leverage trading is seen as very high risk

03:31but there's some key considerations you need to make before you use leverage such as just making

03:37sure you're understanding the market uh before you use the leverage you have a solid understanding of

03:41the market you're trading and the factors that actually influence our price movements as well in

03:46these markets you also need to think about risk management using stop law orders stop stop loss

03:51orders to uh limit your potential losses and never investing more than you can actually afford to lose is

03:56always a good uh rule to follow making sure you're also staying diversified to spread your risk is

04:02another thing also when you talk about leverage ratios or leverage ratios uh be mindful of the

04:09leverage ratio that you're using higher leverage can lead to greater profits but also greater losses

04:14so continuous learning is something that you need to keep doing staying informed in the markets i always

04:19say if you want to try leverage start very low 2x 10x 5x at 10x probably at the higher end of of the

04:27spectrum and then you know if you're starting to really get comfortable with using leverage perhaps

04:32if you really get good at it maybe you can increase uh your leverage usage or the kind of uh

04:39leverage that you tend to use when you're trading so you know like i said at the end of the day it's

04:44always about just sort of balancing these risks and rewards understanding how to use uh leverage

04:50understanding how price moves in the type of markets that you want to apply your leverage

04:55positions when you're trading if this is something that you know um you feel like you want to do and

05:01learn a little bit more you can definitely go to our main site decentralized don't use we've got

05:05all kinds of guides and explainers that really show you how to use a lot of these uh good leverage

05:12trading platforms some of the ones that i like to use are decentralized and non-custodial which

05:17means that you are actually in control of your funds and you're not giving your funds uh to a

05:22third party who is a custodian especially these guys that are tend to promote a lot of leverage they

05:28can be a little bit vulnerable if they're not applying uh by the rules okay so make sure you check

05:34out the links to the um sort of platforms that i like to use gtrade mux protocol scene futures apex

05:40protocol etc all in the description also if you're interested in learning more about decentralized

05:46finance and how you can leverage kind of the new wave of capital markets as far as defi is concerned

05:52to earn a higher yield on stable assets on other crypto assets etc make sure you check out the link

06:00to my book defi millionaire you can also go to defi millionaire or defi-millionaire.com and get the

06:06free download there if you're interested in uh other crypto topics like uh tokenization of real

06:11world assets like real estate or equities check out my book tokenized trillions and also blockchain

06:17applied for those who want to know uh the power of distributed ledges across multiple industries

06:22and also make sure you go to our telegram and our discord server and leave a comment and make sure

06:29you subscribe and give us a like and suggest any other topics that you'd like to see on this channel

06:34like share subscribe i'll see you guys in the next video peace

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