What is 1:1 leverage?

When traders talk about 1:1 leverage (also called 1x), they simply mean trading with no borrowed funds, the same as buying and selling in the spot market. At this ratio, your buying power is limited to the cash you deposit, and your maximum risk is capped at that amount. No margin calls, no liquidations, just your own money at work.

This makes 1:1 leverage a sensible baseline for traders who want to keep risk contained while they build or refine their process. If you deposit $1,000, your maximum trade size is $1,000. You cannot expand the position beyond the cash you put in, which keeps both risk and position sizing simple.

At Leverage.Trading, we cover how ratio changes affect volatility, execution risk, and liquidation mechanics. Profit is always tied to risk, and the goal is clarity, not amplification. In this guide, I’ll walk through why a lot of serious traders still stick to 1x in parts of their portfolio, and how understanding its limits helps you avoid the kind of account-ending mistakes that high leverage can create.

Key takeaways

• 1:1 leverage or 1x means that the trader does not borrow money and is only trading with his own trading capital. This means that if you invest $100, you can only trade with this $100, and no additional funds will be added to your position.
• 1:1 leverage is the lowest ratio possible and is essentially the same as trading the spot market with no borrowed capital. You still face full market risk on your position, but you remove the additional liquidation and margin call risk that comes with higher ratios.
• 1:1 leverage is the lowest ratio possible and it is in essence the same as trading the spot market without borrowed capital which also minimizes the risk. Traders do not have to worry about margin calls or liquidations since there is no extra money added to the positions.

What does 1:1 leverage mean?

1:1 leverage means that you are not borrowing money to increase your purchasing power. A 1x ratio is the same thing as trading without leverage.

This means that the money that you deposit into your trading account will be the maximum position size for any trades that you open.

A ratio of 1 to 1 means that you don’t have to worry about risks of margin call of full liquidations because you will be trading in the same ways as if you were trading the spot market.

There are no margin requirements

Margin requirement refers to the amount of your own money you need to put down as collateral before opening a leveraged position.

With a 1x ratio, the margin requirement is equal to the entire trade size.

Our leverage calculator can be used to calculate margin requirements but it is only necessary at higher ratios.

Let’s say that you want to trade $1000, then your margin requirement would also be $1000. In order words, you will have to deposit the full trade amount no matter how small or large your position is.

We’ve got a guide on how to choose leverage for $1000 that teaches you what ratio is most suitable for this account size.

Examples of real 1:1 leverage trades

Assume that you want to trade Bitcoin with a 1x ratio and the price of Bitcoin is currently $25,000. Your account balance is $3000 and you want to invest $1500 in Bitcoin. With a 1:1 ratio, your margin requirement will be the entire trade size, in this case, $1500.

If the price of Bitcoin moves to $27,000, that 1x position shows an 8% gain, or $120. If it drops to $23,000 instead, you take the same 8% loss, also $120.

The key point here is that your PnL swings line up one-to-one with the market move. You don’t have liquidation risk on top of price risk, which is very different from trading the same idea at 10x or 50x.

Some platforms that offer you this

Some brokers and platforms offer 1x ratios in trading, it all depends on what asset class you want to trade.

When you choose a platform it is important to consider the leverage fees and the trustworthiness of the company.

Crypto traders are better off using a crypto broker that provides leverage while forex traders should select a forex broker.

I recommend using a broker that is regulated by a reputable financial authority.

Advantages

The biggest advantage of using a 1x multiplier is that it keeps your risk profile simple. You are only exposed to the capital you actually put into the trade, which makes it easier to control position size and stick to a risk plan.

Another benefit is that you remove margin call and liquidation risk from the equation. With no borrowed funds, there is no liquidation price and no forced exit triggered by a margin engine.

Traders who are moving from pure spot trading into more complex products often keep part of their activity at 1:1 while they build experience with risk management and execution.

A 1:1 setting also works well for longer-term investing, because you are not paying financing for borrowed money on top of market risk. If you want to hold positions for months or years, keeping leverage at 1x gives the portfolio more breathing room.

Downsides

Even though 1x is on the lower end of the risk spectrum, it still has trade-offs. Your upside is directly tied to the underlying move, so you will not see the kind of explosive swings in PnL that high leverage can produce. For traders who are chasing quick, aggressive returns, that can feel slow.

If the market moves against you, you still take the full loss on your position. 1:1 does not make trading risk-free, it simply removes the extra layer of margin and liquidation risk. A protective stop-loss is still essential.

In very quiet or low-volatility markets, 1x can feel uninteresting for short-term traders. If the underlying barely moves, your PnL will barely move as well.

How it can affect your losses

Losses are not increased when using a 1x ratio. Your losses will be limited to the amount you have invested in your trading account which is a great benefit for risk-averse traders.

Some traders stick with 1x indefinitely, especially if their goal is to avoid liquidation mechanics and keep risk simple and measurable.

If you invest $800 in a forex account and the market goes against you by 1,5%, your loss is going to be limited to the account balance only. In this case, the loss would be $12.

Comparing some ratios for better understanding

1:1 is the lowest ratio available and the next ratio would be 1:2. The difference between 1:1 vs a 1:2 multiplier is pretty significant. At 1:2 credit, it means that you borrow 100% of your current account balance and can double your trade size.

Higher ratios such as 1:10 or 1:100 dramatically increase position size and risk. At those levels, even small moves in the underlying can push you into liquidation.

Profit and loss both scale with the multiplier. A 10x or 100x setting can turn a small move into a large gain, but it can just as easily wipe out the account if risk is not tightly controlled. Traders who use those ratios are usually very selective and rely on strict risk rules.

How it affects you lot size, no matter your account size

With 1:1 leverage, you will not be able to trade a larger lot size than your account balance. If you have deposited $800 in your account, this will be the maximum lot size.

The differences between leverage and lot size in Forex are big. Lot size is the number of units for a currency pair while borrowed capital is the active multiplier of your capital.

Since no borrowed money is used at a x1 ratio, your account balance is all the trading capital you will be able to use for your positions.

Can you get margin called or liquidated at this level?

Traders who use a 1x multiplier do not have to deal with margin calls or forced liquidations from borrowed funds.

Because you are not borrowing money, there is no additional margin risk layered on top of normal market risk. In most retail setups, the maximum you can lose is the capital you deposit into the account.

If you fund the account with $500 and the market completely reverses against your positions, your worst-case loss is that $500. You can still lose everything you put in, but you are not exposed to the kind of negative-balance scenarios that can appear with aggressive leverage on some products.

FAQ

Conclusion

1:1 leverage is the lowest ratio you can choose as a trader and it comes with the simplest risk profile.

You keep full control over position size, but a 1x multiplier also means your profit potential is tied directly to the underlying move, without any amplification from borrowed money.

Many traders use 1x when they want clean, spot-style exposure without margin complications. When you choose a trading platform, make sure you can adjust your ratio down to 1:1, review the fee structure, and check the broker’s reliability and regulatory status.