I think this could have some unfortunate side-effects.
Imagine somebody like aldrums, who wants to learn, but doesn't want to risk a lot of capital. Imagine such a person trading, say, a $5000 account. (It can be done. Won't make a bundle, but you can learn from it, and there are brokers that have reasonable fees that will accomodate this kind of trading.
Now imagine this person taking out a 2'nd mortgage to bring their account up to $25,000, so that they can "stay in the game".
Now imagine the effect of 4X margin on somebody just starting out.
Now imagine this: borrow, lose, repeat. Borrow, lose, repeat.
Sure, it can happen now. But I think this might encourage people who are currently trading money that they truly can afford to lose to step up to trading an amount that might truly hurt them to lose, at a time when they have little experience. |
