Key insights
- The post questions the risk of using 2x-4x leverage on ETFs or stocks like NVDA, MU, arguing that a 25-50% wipeout is unlikely and stop-losses can mitigate risk. However, it overlooks the magnified impact of volatility, margin call risks, and the potential for rapid losses exceeding the stop-loss level, especially during unexpected market events. While leverage can amplify gains, it significantly increases the potential for substantial losses, making it unsuitable for inexperienced traders.
I am new to this, but from what i understood your investment or trading will be wiped out only if it hit 100/leverage no
Loke of. You have 10x leverage
Then the maximum low you can you is 100/10 equal 10 percent, if it hit that or lower you get wiped out
But if you do a 2x or 3x or even 4x you are dealing with a 25-50% wipe out, which for my view is very very unlikely for things like etfs, or some certain stocks like nvda, mu, sndk, so why dont i invest on these type of etfs or stocks with leverage
Not to mention you can add a stop loss to remove any negative near zero trades.
Sorry if this is a stupid question but i am genuinely trying to understand here, am i looking at it right?