If you use 10x leverage on a $100 trade, your effective position size becomes:
Position Size=Investment×Leverage=100×10=1000
Now, if the trade makes 1000% profit:
Step 1: Calculate Profit on the Position Size
To find the profit, multiply the position size by the
profit percentage as a decimal:
Profit=Position Size×(Profit Percentage/100)
Substitute the values:
Profit=1000×(1000/100)=1000×10=10,000
Step 2: Calculate the Total Amount
The total amount is the sum of the position size and the profit:
Total Amount=Position Size+Profit
Substitute the values:
Total Amount=1000+10,000=11,000
Would you like further simplifications or additional explanations?
Important Note on Leverage
Your initial investment is still $100, but the profit amplifies because of leverage.
However, leverage also increases risk. If the trade moves against you, losses are amplified, and you could lose your entire $100 or more.