So i am dabbling into trading again and i have a question about leverage. i was wondering if you start out with 100 dollars starting balance and you use 10 leverage and you manage to blow your account, are you liable to pay the full 1000 dollars that leverage gave you? Or you do just lose your initial starting balance?. I am not sure how this works please clear this up for me thanks.
Depending on the type of margin you have used.
If you used cross margin and opened a 10x leverage position using the $100 and there was some more money in your futures account. once the liquidation price is hit, you will lose all the money in your futures account as it would act as collateral
If you used isolated margin and opened a 10x leverage position using the $100 and there was some more money in your futures account. Once the liquidation price is hit, you will lose one the money you used to open the position ($100) as it would act as collateral