A lot of beginners myself included when I first dabbled in trading tend to focus too much on the charts, the strategies or even the success stories online while overlooking the basics of financial preparation and emotional management. Many beginners think high leverage is a shortcut to financial freedom but more often than not it just accelerates losses. I’ve found that keeping leverage small and focusing on consistency is a much healthier way to grow both skills and confidence.
Indeed, by using lower leverage, we can certainly reduce potential losses while trading. Furthermore, traders can learn from their mistakes, develop and test much better trading strategies. Using lower leverage encourages more discipline in both capital and risk management. They can also learn to be more deliberate in their decision-making and to be more careful in selecting trading positions. Traders can also experience short-term success, which helps build confidence, which is essential for better decision-making in the future.