EA Forex Academy – Algorithmic & Manual Trading Courses Forums Forex Trading Forum EA Studio doesn't seem to take leverage into consideration

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  • #7759
    jacpin2002
    Participant

    Hi Petko! Since I have been having leverage on my mind, I noticed something when I was trying to see the difference in profit between a 1:100 account vs. a 1:500 account. When I used the Validator with my current EAs and just changed my account settings, there was no difference. Does EA Studio not take leverage into consideration? My understanding is that leverage affects pip/point value. For example,

    1:100 leverage=0.01 pip value

    1:500 leverage=0.05 pip value

    So I was expecting to see an increase in the net profit of my current EAs, but didn’t. Am I doing something wrong? Or maybe my understanding of leverage to pip/point value is incorrect?

    #7769

    Hey Jacpin,

    Glad to see you opened another interesting topic.

    Now, the leverage has nothing to do with the results in pips. That is why EA Studio does not have any interfere with it, ot any settings about it.

    Leverage with simple words is borrowed money from the broker to open higher positions. Of course we do not pay any interest on it.

    For example, if you have 10 000 account with 1:100 leverage, you will be able to opene maximum 100 times bigger positions, which is 1 000 000 position. BUT the maximum you can lose will be your 10 000 that you have. And this could happen with small move of the price.

    That is why we never open the maximum we can.

    Now, if you have 1:500 you will be able to open 500 times bigger position from what you have in the account.

    Another thing, 1:1 is if you go on the exchange bureau and buy any currency.

    The move of the market is one and the same…nothing to do with the leverage. This is between you and the broker, not the market.

    I hope I explained it in more practical way.

     

    #7770
    jacpin2002
    Participant

    @Petko-Ah, ok. This does explain it a bit more simpler to me. Thanks so much.

    #7779

    You are welcome, Jacpin.

    What you need to keep in mind is that the higher leverage gives you the change to trade with more EAs, because it will block less from your account.

    The brokers benefit more from higher leverage because the beginner trades get very greedy after few profitable trades and open huge positions with huge leverage, and they lose it all…that is why after the new regulations, most of the brokers benefit much less…

    Kind regards,

    #7814
    Admin bar avatarHaliffa
    Participant

    I take the leverage as opportunity to open bigger positions. Take it as if you are trading 1:1, with 1k you will be able to go the the bank or the exchange and take some other currency. If you trade with CFD, you have the change with 1k to trade bigger amounts.

    #7833

    Pretty well said, Haliffa!

    #7977
    Admin bar avatarAndi
    Participant

    I think leverage is very useful specially for the beginner traders.

    Not everyone can afford to trade with 10k or more.

    Personally I started with a small amount, and if there was no leverage I was not going even to start. Anyway the whole time, education and effort would not worth.

    I use 1:100 and I think is normal, we just need to have good money management.

    #7979
    jacpin2002
    Participant

    @Andi-Hi there! Yeah, I use 1:100 as well. I was thinking of going up to 500, but I decided not to even try it out. I don’t feel like going through that right now. I’m just going to stick with making sure I am using the most profitable EAs on my account. πŸ™‚

    *On 12/31/18, I’m going to post a screenshot of the live accounts I manage to show the closing profit for the end of the year. πŸ™‚ One account is my own and the other is a friend of mine. EA Studio is the best thing that ever happened to us!

    #7990

    Hey guy, Andi, Jacpin, I am so glad that you share your experience.

    Really do not hesitate to drop any pictures, trading History etc. This way you will motivate many beginner traders, and you will show them that it is all possible!

    If you look at other Forex forums you will see how skeptical are all “traders” because they keep on losing money trading manually…

    When I started this Forum, I wanted just such an environment, where everyone is opened to share. This way many traders will see that it is actually possible to make profits from Forex, but when you have the right education and software!

    #8028
    John Michael
    Participant

    Yes, Petko! You are very right here!

    I used to read a lot of Forums before I cam here, and all were very negative regarding trading. I think most of the people lose money. You said in some of your courses that those are 95% of the traders, which means that 95% of the traders are writing negative things in the Forums πŸ™‚

    Your education is excellent. I wish I can spend more time on it, but I will do my best in 2019!

    #8038

    Back to the topic here, opened by Jacpin

    One of the biggest brokers nowadays( I will not mention the name) demonstrated to me the other day their algorithmic trading app they have. They worked on it over 2 years now, and the first step they placed is the leverage πŸ™‚ Now they will need to restart it all and remove the leverage..

     

    #8054
    John Michael
    Participant

    Petko, why they do not hire you just to tell them how it should be? Also, are the brokers able to create useful strategy builders?

    #8068

    Hey, John!

    Well, because I do not want to work with brokers for any reason πŸ™‚ No, seriously those are old friends we worked together years back in different financial institutions. They normally try to show off with their new products, but I always leave themΒ  frustrated after the conversation because they realize it is not enough what they did.

    Anyway, the brokers can not do it for two reasons:

    1. This is not their main job, they are brockarage

    2. They do not want to clients to profit. So whatever they do, it wont be useful for the trader.

    This is why EA Studio and FSB Pro are such great softwares, because they are created in favor of the trader.

    Kind regards,

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