| Updated: June 18, 2024Leverage is a crucial element in forex trading, determining the risk level related to your trades and the potential return you can enjoy. With high leverage indicating a significantly higher potential for massive losses, many trading regulators around the world have introduced leverage limits. Under trading regulations imposed by the Commodity Futures Trading Commission (CFTC), brokers authorized to operate in the US are allowed to offer a maximum leverage of 50:1 on major currency pairs and 20:1 on exotic and non-major pairs.
FP Markets73.85% of retail investor accounts lose money
Fusion Markets74-89% of retail CFD accounts lose money
Markets.com74.2% of retail investor accounts lose money
eToro51% of retail investor accounts lose money
Plus50080% of retail investor accounts lose money
IG70% of retail client accounts lose money
FBS72.12% of retail investor accounts lose money
XM Group72.82% of retail investor accounts lose moneySome jurisdictions allow much higher leverage ratios on currency trading, significantly increasing the potential return with ratios like 100:1, 500:1, or even higher. That said, many brokers will allow traders to adjust the risk of their trade and make use of lower leverage, which can still be around the 50:1 ratio.
Below, we have listed some of the best forex brokers that offer retail traders leverage of 50:1 on major pairs. Each brand we have covered is properly regulated and allows traders to minimize the risk, while still making use of decent leverage ratios.
- 1. eToro
One of the big players in the forex trading sector, eToro offers its clients competitive offerings, tight spreads, fast executions, and more than 40 global currency pairs to trade. Founded in 2007 in Israel, eToro is currently catering to thousands of traders worldwide. Licensed to operate by regulators like FCA, CySEC, ASIC, FSAS, and FSRA.
Due to regulations in specific jurisdictions, the maximum leverage that eToro may offer to retail forex traders may not exceed 30:1. That said, non-EU and non-Australian traders may choose to take advantage of 50:1 leverage on multiple currency pairs, with some options even offering higher leverage ratios. That said, we advise traders to be extra careful due to the high risk linked to higher leverage.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 51% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. - 2. Plus500
Standing out from the rest requires being one of the best in your field and that is what Plus500 has been doing since its inception in 2008. Currently, the brand is one of the most prominent brokers catering to global traders, covering multiple markets, including forex, indices, stocks, and more. Plus500 is a reputable brand that has been authorized to operate in multiple jurisdictions, with regulators like FCA, ASIC, CySEC, Seychelles FSA, and more overseeing the operations of the broker.
Plus500 offers its clients the chance to trade more than 60 different currency pairs, with different account options allowing traders great perks. Maximum leverage may differ depending on the forex policies within your country of residence. That said, non-EU and non-Australian traders may enjoy 50:1 leverage on various currency pairs.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. - 3. XM Group
Since its inception in 2009, XM has expanded to cater to more than 10 million customers worldwide, becoming one of the top forex and CFD brokers in the world. The broker welcomes investors from over 190 countries, operating thanks to authorizations obtained by tCySEC, ASIC, and IFSC. With such top-tier regulators overseeing the operations of XM, traders can be certain they can trust the broker with their trades.
Forex traders will be able to choose from over 50 currency pairs, with popular platforms like MT4 and MT5 available for smooth forex trading at any time and place. As for the leverage offered to members of the broker, it should be noted that due to regulations imposed by CySEC and ASIC, certain traders will not be able to enjoy leverage ratios higher than 30:1 on major currency pairs. That said, those residing in regions that do not fall under said regulations will be able to enjoy leverage of 50:1 on multiple currency pairs.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72.82% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. - 4. IG
Offering a top-notch forex trading experience, IG ranks as one of the top destinations for global investors. The brand started its business way back in 1974 and has managed to extend its reach across multiple countries, with major regulators like CFTC, ASIC, FMA, and many more overseeing the trading operations conducted by IG.
Forex traders will be extremely pleased with the markets covered by the broker, with over 90 currency pairs to trade. Competitive pricing is also something to look forward to when trading currencies with IG’s help. As for the leverage offered to investors, the allowed maximum will vary depending on the regulator overseeing the operations of the IG entity you have joined. That said, many traders who have registered with IG will be offered leverage of 50:1 or even higher on major currency pairs.
CFDs are complex instruments. 70% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money. - 5. FBS
FBS joined the forex market in 2009, and since then, it has been a top pick for thousands of traders across more than 150 countries. Dedicated to educating its clients, FBS provides various training materials and events catering to beginner and professional traders. With over 550 instruments to trade with, FBS ranks as one of the best forex brokers online, allowing investors to trade more than 30 currency pairs.
Members of FBS can choose between the MT4 and MT5 trading platforms, with both options optimized both for desktop and mobile devices. Since the broker is compliant with different regulatory guidelines imposed by the FSC, CySEC, and ASIC, the maximum leverage applied to certain major currency pairs may differ. That said, some members of the broker will have the chance to enjoy a 50:1 leverage ratio on multiple currency pairs.
Risk warning: ᏟᖴᎠs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72.12% of retail investor accounts lose money when trading ᏟᖴᎠs with this provider. You should consider whether you understand how ᏟᖴᎠs work and whether you can afford to take the high risk of losing your money. - 6. Markets.com
Operating since 2009, Markets.com is one of the top performers in the forex trading sector, bringing its customers access to numerous markets, including 56 currency pairs. The broker has been licensed to operate in multiple regions, with regulators like the FCA, ASIC, CySEC, and more authorizing Markets.com’s forex operations. To offer its clients a smooth trading experience, the broker supports different platform formats, including MT4, MT5, and a proprietary web platform.
Forex trading at Markets.com is fair and safe, with the broker being compliant with a set of regulatory requirements imposed by top-tier regulators. As for the leverage one can enjoy while trading currencies, the maximum cap in certain jurisdictions may be 30:1. That said, many of the broker’s clients will have 50:1 leverage on multiple currency pairs they would like to trade.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.2% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. - 7. FP Markets
FP Markets is an Australian-based broker that started its business in 2005 and has offered some of the best forex trading conditions to traders ever since. Nowadays, the brand has reached numerous forex markets across Australia and Europe, with regulators like the ASIC and CySEC authorizing the financial services offered by FP Markets.
Forex traders will be able to trade popular currency pairs as well as multiple exotic and non-major pairs, with tight spreads and no commission on many of the assets one can trade with FP Markets. As for the leverage one can enjoy, there will be different maximums applied to currency pairs, with caps dependent on the regulatory requirements implemented by the CySEC and ASIC. That said, traders who wish to enjoy higher leverage ratios like 50:1, 100:1, or maybe even higher can upgrade to professional trading accounts.
10 per quarter for non-AU traders; 20 per quarter and notional volume of AU$1,000,000 per 4 quarters in the last 1 year 73.85% of retail CFD accounts lose money Fusion Markets launched its trading services in 2019, with regulators like the FSA, ASIC, and VFSC authorizing the operations of the brand. Catering to forex and CFD traders from different parts of the world, Fusion Markets provides cost-effective trading conditions and a fair trading environment for its customers. Dedicated to ensuring seamless operations for any type of trader, Fusion Markets supports a variety of platforms and tools like MT4, MT5, cTrader, DupliTrader, and TradingView.
Forex traders will be able to trade over 80 major and exotic currency pairs, enjoying low commission rates and tight spreads. While the leverage traders can make use of while trading on forex may depend on their account types as well as regulatory conditions, plenty of Fusion Markets clients will be able to enjoy a leverage ratio of 50:1 or maybe even higher.
Gleneagle Asset Management Limited (ABN 29 103 162 278) trading as Fusion Markets, is the issuer of the Fusion Markets Products described in this communication. Trading in Fusion Markets Products involves the potential for profit as well as the risk of loss which may vastly exceed the amount of your initial deposit and is not suitable for all investors. You should read all of these Financial Product Service Terms, the Product Disclosure Statement (PDS) and the Financial Services Guide (available on our website) carefully, consider your own financial situation, needs and objectives for investing in these Fusion Markets Products and obtain independent financial advice.
Comprehensive Comparison of the Top 8 Forex Brokers with 1:50 Leverage
| Forex Broker | Min Account Requirements | Tradable Markets | Negative Balance Protection | Stop-Out Level | Trading Platforms | Trust Pilot Rating |
|---|---|---|---|---|---|---|
| 1. FP Markets | $100 | 10,000+ | Yes (Retail traders) | 50% | MetaTrader4, MetaTrader5, WebTrader, IRESS | 4.8 ⭐ |
| 2. Fusion Markets | $0 | 250+ | Yes (ASIC entity only) | 20%; 50% (ASIC) | MetaTrader4, MetaTrader5, cTrader, DupliTrade, Fusion+ Copy Trade | 4.8 ⭐ |
| 3. Markets.com | $100 | 3,700+ | Yes | 50% | MetaTrader 4, MetaTrader 5, WebTrader, Mobile App | 4.7 ⭐ |
| 4. eToro | $50 | 5,000+ | Yes (Retail traders) | 50% | eToro Investing, eToro App, TradingView, eToro CopyTrader | 4.2 ⭐ |
| 5. Plus500 | $100 | 2,800+ | Yes | Listed in platform | Proprietary desktop and mobile platforms | 4.1 ⭐ |
| 6. IG | $0 | 17,000+ | Yes (for limited risk accounts) | 50% | MT4, L2 Dealer, ProRealTime, IG proprietary software | 4.1 ⭐ |
| 7. FBS | $100 ($10 for cent accounts) | 550+ | Yes | 20% | MT5 Desktop, MT5 WebTrader | 3.6 ⭐ |
| 8. XM Group | $5 | 1,200+ | Yes, for retail clients | 50% | MetaTrader 4 and 5, MetaTrader 4 and 5 on mobile, MT4 WebTrader, MT5 WebTrader, MT$ Multiterminal | 2.7 ⭐ |
What Does Leverage Mean in Forex Trading?
If you are new to forex trading, leverage is one of the key terms you need to get familiar with. Investors tend to take advantage of leverage to increase their potential profit from trading. The forex trading sector offers some of the highest leverage ratios, which means forex traders can often boost their returns significantly.
Leverage can be described as a type of loan traders take from the broker to enhance their profit when trading currency pairs. Of course, the broker needs collateral for the money it lends to traders, with the funds deposited into their margin accounts being used as insurance. By taking advantage of leverage, forex traders are allowed to place orders that significantly exceed the actual amount available in their accounts.
While using leverage can increase the potential return for your forex trades, it also increases your chances of losing large amounts of money. That is the reason why some brokers have introduced limits on maximum allowed leverage, with many top-tier regulators requiring trading websites to impose mandatory leverage limits on retail trading accounts.
While traders may be allowed to manage the size of their trades based on the leverage they wish to make use of, brokers tend to request a percentage of the traded amount to be held in traders’ accounts as cash. This type of amount requested to be available in one’s balance is also known as an initial margin.
What is Margin in Trading?
As explained above, the margin is used as collateral for the leverage (loan) released by the broker to traders. Simply put, margin is considered the money you have available in your account. As soon as you deposit funds into your trading balance, you will have the opportunity to make use of leverage whenever trading forex or any other derivatives offered to members of a brokerage.
Whenever the trade you have used the leverage for is closed, the funds in your margin account are available to be used again. However, in the case of the entire margin being lost or at risk, traders will not be able to make use of leverage as they will not have access to their margin account, which will serve as collateral for the loan.
The correlation between the margin and the leverage ratio reveals that the lower the margin requirement, the greater the leverage traders can get. That said, it should be noted that brokers may often require higher margins that may be determined by the type of currencies you are trading. A highly volatile currency pair may lead to huge fluctuations, which in turn, may result in steep rate changes. In such cases, the broker may require a bigger margin as collateral for the loan.
Leverage Ratios and What They Mean
To help traders determine the potential risk/return linked to a certain leverage, brokers would use leverage ratios. These would demonstrate the size of the boost applied to your trade compared to the margin that is held as collateral. With many regulatory bodies in the forex trading market imposing a specific maximum of leverage applied to currency pairs, allowed maximums would be expressed in the form of leverage ratios. These can be 20:1, 50:1, 5000:1, and so on.
Understanding leverage ratios will help you assess both the potential return and the risk attached to your trades. Since this article focuses on brokers offering maximum leverage of 50:1, we would use this ratio to further explain this trading term. The 50:1 ratio ($50,000 / $1,000) indicates that for a $1,000 deposit (margin), investors can trade $50,000 оn the currency pair with a 50:1 leverage attached to it. The required margin for a 50:1 leverage ratio is 2%, which means that investors are required to have at least 2% of the total trade amount in their margin account.
Below, you can see the margin requirements for most leverage ratios allowed in different jurisdictions.
| Margin Requirement | Leverage |
|---|---|
| 5% | 20:1 |
| 3.33% | 30:1 |
| 2% | 50:1 |
| 1% | 100:1 |
| 0.5% | 200:1 |
| 0.2% | 500:1 |
| 0.02% | 5000:1 |
It should be noted that depending on the volume of the trades, brokers might request different margin rates. Higher leverage and lower margin are typically applied to smaller trades, while standard trading on 100,000 currency units might have a higher margin and lower leverage ratio. You may often see a broker offering a 50:1 leverage ratio on a $50,000 trade, which means the margin of 2% would require a collateral of at least $1,000 in your margin account.
Risks Associated with High Leverage
Leverage is an instrument that should be approached with caution, as it comes with a significant risk rate. Beginners often underestimate the possibility of accumulating massive losses in a rapid manner if they are using high leverage. That is one of the reasons why newly opened broker accounts are often allowed significantly lower leverage ratios while trading currency pairs.
What traders need to understand is that leverage is a double-edged sword since it can significantly boost your potential return but it can also lead to tremendous losses within seconds. Even small market fluctuations can cost you your entire margin amount and even accumulate a debt you will owe the broker due to the high leverage applied to your trade.
The risk related to high leverage is why regulators like CFTC, FCA, ASIC, and many more have introduced mandatory leverage maximums. As already mentioned, brokers licensed to operate in the US are required to limit the allowed leverage on major currency pairs to 50:1. Meanwhile, non-major and exotic pairs have an even lower maximum of 20:1, as such currencies are typically unstable and can lead to rapid and huge fluctuations.
You might also be interested in exploring these top forex brokers:
- Forex Brokers with 1:100 Leverage
- Forex Brokers with 1:200 Leverage
- Forex Brokers with 1:300 Leverage
- Forex Brokers with 1:500 Leverage