Leverage is one of Forex trading’s most powerful tools, allowing traders to control large positions with minimal capital. For example, a 1:100 leverage means you can control a $10,000 trade with just $100. While this can amplify profits, it also increases the risk of significant losses. To use leverage wisely, never risk more than 1-2% of your trading capital on a single trade and always have a stop-loss in place. Leverage should be treated with respect—it’s a tool for growth, not a shortcut to wealth.