What Is Margin Trading

Margin trading on Fokawa allows traders to borrow funds to trade larger positions than their account balance would normally permit.

• Definition:Trading with borrowed funds to amplify potential returns (and risks).
• Leverage:The ratio of borrowed funds to your own funds. For example, 5x leverage means you can trade $500 with $100 of your own funds.
• Interest Rates:Borrowed funds incur interest, which varies based on the asset and market conditions.
• Risks:Increased potential for higher returns, but also greater risk of significant losses.

Updated on: 19/06/2024