Copy trading and leverage

Created at 17 Mar 2022, 00:08
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paudel_bishnu

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Joined 06.10.2020

Copy trading and leverage
17 Mar 2022, 00:08

Hi all,

I am new to copy trading and wanted to know how leverage on copiers account affect the position sizing.

I am copying an account with 1:30 leverage and it opens .01 lot of US30. When same strategy is copied using 1:500, it opens 1 lot of US30.

Wondering how is this calculated/scaled?

Also, the strategy providers leverage appears to be 1:500 on its description page but when I contacted the provider he confirms its 1:200.

Thanks

@paudel_bishnu
Replies

PanagiotisCharalampous
17 Mar 2022, 08:10

Hi there,

Leverage does not affect position sizing. It only affects margin allocation. The reason this happens is because your broker does not allow for lower position sizes on the specific symbol.

Best Regards,

Panagiotis 

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@PanagiotisCharalampous

paudel_bishnu
18 Mar 2022, 03:09 ( Updated at: 21 Dec 2023, 09:22 )

RE:

PanagiotisCharalampous said:

Hi there,

Leverage does not affect position sizing. It only affects margin allocation. The reason this happens is because your broker does not allow for lower position sizes on the specific symbol.

Best Regards,

Panagiotis 

Join us on Telegram and Facebook

Hi Panagiotis,

Thanks for you reply. It makes sense. I was actually got mixed up with TopFx and Fondex. Fondex's min lot is actually 1 lot.

However, I still find some differences in performance of accounts with different leverage.

I am copying a strategy in ICmarkets demo with 1:500 and 1:30 leverages. A trade that has made profit in 1:500 is a losing trade in 1:30. 

This is screenshot from 1:500 account:

Below is screenshot from 1:30 account:

Wondering how the execution happens.

Thanks,

 

@paudel_bishnu
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