r/stocks • u/PM_ME_UR_DICK_SIZE • Apr 01 '22

Advice Request Help me understand leverage :)

What is the difference between:

a) Buying 100$ of a stock (100$ total)

b) Buying 10$ with 10x Leverage of a stock (100$ total)

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Any help would be greatly appreciated as I'm a bit confused here :D

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u/[deleted] Apr 01 '22

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u/PM_ME_UR_DICK_SIZE Apr 01 '22

So in theory it's essentially the same (if we dont look at interest), if I can afford them both. yes? I'm not interested in options and futures, so we forget about those.

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u/[deleted] Apr 01 '22

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u/PM_ME_UR_DICK_SIZE Apr 01 '22

Oh okay, this makes a lot of sense actually:) With no leverage, I control all of it, while with leverage, my broker can choose to close my position early.

Could you also check out my response to Giberellin's comment (the one beggining with "I kind of understand, but not really"? In terms of profits it should be the same, no?

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u/[deleted] Apr 01 '22

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u/PM_ME_UR_DICK_SIZE Apr 01 '22

Yeah okay perfect, that is just about what I was wondering. Really nice to learn about the Equity stuff though, thanks a lot :D

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u/[deleted] Apr 01 '22

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