Leverage Trading

Get a Better Understanding of Leverage Trading and how is it being used in Compass Asset Management's Platforms.

What is Leverage Trading?

Compass Asset Management Provides Trading Tools such as Leverage Trading to widen the options of the Investor. With the ability to trade any financial tool that we are offering and increase your buying power with a click of a button.

Leverage results from using borrowed capital as a funding source when investing to expand the firm’s asset base and generate returns on risk capital. Leverage is an investment strategy of using borrowed money 

Financial Instruments Available to Leverage:

Foreign Exchange

Foreign exchange, or forex, is the conversion of one country’s currency into another. In a free economy, a country’s currency is valued according to the laws of supply and demand.

Commodities

A basic good used in commerce that is interchangeable with other goods of the same type. Traditional examples of commodities include grains, gold, beef, oil, and natural gas.

Index

Index trading is a type of trading of a group of stocks that make up the index. An index is a measurement of the value of a section of the stock market.

Crypto Currencies

Cryptocurrency is a digital payment system that doesn’t rely on banks to verify transactions

Compass Asset Management trading platform

Be one step ahead and Improve your trading results with our industry-leading technology.

< 7.12 ms

Average order execution speed

12+

Executed orders per second

> 12.000

Executed orders per second

$545,000,000

Average trading volume per day

Understanding Leverage

Leverage is the use of debt (borrowed capital) in order to undertake investment or project. The result is to multiply the potential returns from a project. At the same time, leverage will also multiply the potential downside risk in case the investment does not pan out. When one refers to a company, property, or investment as “highly leveraged,” it means that the item has more debt than equity.

The concept of leverage is used by both investors and companies. Investors use leverage to significantly increase the returns that can be provided on an investment. They lever their investments by using various instruments, including options, futures, and margin accounts. Companies can use leverage to finance their assets. In other words, instead of issuing stock to raise capital, companies can use debt financing to invest in business operations in an attempt to increase shareholder value.

Investors who are not comfortable using leverage directly have a variety of ways to access leverage indirectly. They can invest in companies that use leverage in the normal course of their business to finance or expand operations—without increasing their outlay. 

Leverage vs. Margin

Leverage is the use of debt (borrowed capital) in order to undertake investment or project. The result is to multiply the potential returns from a project. At the same time, leverage will also multiply the potential downside risk in case the investment does not pan out. When one refers to a company, property, or investment as “highly leveraged,” it means that the item has more debt than equity.

The concept of leverage is used by both investors and companies. Investors use leverage to significantly increase the returns that can be provided on an investment. They lever their investments by using various instruments, including options, futures, and margin accounts. Companies can use leverage to finance their assets. In other words, instead of issuing stock to raise capital, companies can use debt financing to invest in business operations in an attempt to increase shareholder value.

Investors who are not comfortable using leverage directly have a variety of ways to access leverage indirectly. They can invest in companies that use leverage in the normal course of their business to finance or expand operations—without increasing their outlay.