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How Does the Concept of “Leverage” Apply to Futures Trading?

Traders control a large contract value with a small margin deposit, magnifying both potential profits and losses.
Greeks.Live24.11.25

How Does the Concept of “Leverage” Apply to Futures Trading?

Leverage in futures trading allows a trader to control a large contract value with a relatively small amount of capital, known as margin. For example, 10x leverage means a $1,000 margin can control a $10,000 contract.

While this magnifies potential profits, it also significantly amplifies potential losses, making futures a high-risk instrument.

Explain the Concept of “Leverage” as Applied to Trading Financial Derivatives
What Is “Leverage” in the Context of Both Options and Futures?
How Does Leverage in Derivatives Trading Amplify Both Potential Gains and Losses?
What Is a “Margin Call” and What Triggers It?

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