In This Chapter
Leveraging your way to wealth
Trading options, futures, and money
Trading isn’t a get-rich-quick business; however, by trading, you can make money faster than normal. One of the techniques people use to get wealthier faster is leverage. And you can use leverage (which I define in this chapter) not only in the financial markets but also in many areas of business.
In this chapter, you find out what leverage is and how to use it in trading to make money faster than usual. You also discover the perils to beware of when using leverage.
In mechanical terms, a lever is a bar that rests over a fulcrum, used to move an object at one end by applying force at the other end. It can provide a mechanical advantage by allowing you to move a heavy object with relatively less force than would be required without the lever.
In financial terms, leverage refers to the ability to control a financial asset with a smaller amount of money than the asset is worth. In the following sections, I explore leverage as it relates to using it to make money with a small account and also the risks that accompany it.
The use of leverage is paramount to accelerate success in all types ...