# What Is Leverage?

**Leverage** is the ratio between the volumes being traded, i.e. the total investment amount with the multiplier applied, and the used margin amount.

**What is the maximum leverage for each asset class?**

a. 30:1 for major currency pairs (3.33% margin)

b. 20:1 for minor currency pairs, gold, and major indices (5% margin)

c. 10:1 for commodities other than gold and minor indices (10% margin)

d. 5:1 for individual equities and other reference values (20% margin)

e. 2:1 for cryptocurrencies (50% margin)

**How will this affect my trading account with Libertex?**

When you trade any asset, the leverage applied depends on the class such an asset belongs to.

With higher leverage, you need less funds (margin) to open a position, which allows you to open big trades while investing just a fraction.

Conversely, if the leverage is low, you will need more own funds to open your position.

**How do I know the total amount of the trades I can open when my account balance is N?**

**Maximum Amount **= Free Margin * Max Leverage for the asset class in question

**Example 1.**

Let's assume now your account balance is again €10,000, but you want to open multiple trades on EUR/USD.

This is a major currency pair, so the maximum leverage here is 30:1.

Thus, your maximum overall trade amount with multiplier applied is 10,000*30=€300,000.

So, you are free to open any number of EUR/USD trades you want, but their total value, including the multiplier, must not exceed €300,000.

**Example 2.**

Let's assume your account balance is again €10,000, and you want to open multiple trades on gold.

For minor currency pairs, gold, and major indices the maximum leverage is 20:1.

Thus, your maximum overall trade amount with multiplier applied is 10,000*20=€200,000.

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