What is a pip forex

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Leverage in forex works source multiplying the trader's initial investment, known as margin, to gain greater exposure to currency pairs.

Article source leverage ratio indicates the amount of borrowed funds the broker provides in relation to the trader's margin. This increased what is a pip forex power can offer substantial gains opportunities but also entail higher risks.

Traders must exercise caution and employ adequate risk management strategies to navigate the potential downsides of leverage, as adverse market movements can lead to significant losses.