Leverage = borrowed capital to amplify trades. 10x leverage means 10% move makes/loses 100% of your capital. Powerful but dangerous — the #1 cause of retail trader wipeouts.
📊 Common Leverage Products
- Margin loan: 1:2-1:5 — moderate leverage from broker
- VN30F1M Futures: 1:5 implicit (margin ~17-20%)
- Crypto perpetuals: 1:100 max (Binance, OKX)
- Forex: 1:30-1:500
⚠️ Liquidation
- 10x leverage: 10% adverse move = 100% loss (liquidated)
- 50x leverage: 2% adverse move = total wipeout
- "Liquidation cascade": forced selling triggers more liquidations
📉 Statistics
- 90%+ of high-leverage traders lose money long-term
- Crypto perpetual: $100M+ liquidated per major crash
- Vietnam margin trading: ~60% retail traders lose during downtrend
🎯 Safe Rules
- Never > 3x leverage as a retail trader
- Max 2% account risk per trade
- NEVER use leverage on penny stocks