What is leverage?

With 10x leverage, $1,000 of margin controls a $10,000 position. A 5% move in your favor is a 50% gain on the margin. A 5% move against you is a 50% loss, and a move of roughly 10% against you can trigger liquidation.

Leverage does not change how much you should risk. A properly sized position has the same dollar risk at 2x or 20x; what changes is how much margin is tied up and how close liquidation sits to your entry.

Leverage used without a defined stop and a sized position multiplies mistakes. Used inside those rules, it is a capital efficiency tool. Either way it carries real risk of rapid loss.