Guide · Last updated: October 13, 2026

What is leverage?

Leverage lets you open a position larger than your margin. With 10x leverage, 100 USDT of margin opens a 1,000 USDT position; profit and loss are calculated on the position size so they scale by the same factor.

What does leverage change?

Leverage determines the margin you commit, not the size of the position. Profit and loss come from the size. Higher leverage ties up less margin for the same position but moves the liquidation price closer to entry.

What does risk depend on?

The real risk comes from stop distance and position size. Two positions with the same size and stop distance lose the same money whatever the leverage; the difference is liquidation distance and margin usage.

The cost of high leverage

With high leverage even a small wick can be enough for liquidation. That is why many traders cap risk per trade at 1–2% of capital and keep leverage low enough to match.

Example

100 USDT margin, 5x: a 500 USDT position. If price moves 2% against you the loss is 10 USDT (10% of margin). At 20x the same 100 USDT controls 2,000 USDT, and a 2% move costs 40 USDT (40% of margin).

Where do you see it in KARDVANE?

The position calculator in Tools works out the size and leverage you need from your stop and risk.

FAQ

How much leverage should I use?

That is a personal decision; the general principle is to limit risk through stop distance and position size, not through leverage alone. Lower leverage keeps liquidation further away.

This page is educational; it is not investment advice.