Kenneth George729_ Davis#59

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What is ESMA leverage restriction in Europe?

The European Securities and Markets Authority (ESMA) implemented leverage limits for retail traders: 1:30 for major currency pairs, 1:20 for minors, and 1:10 for commodities. These rules aim to protect clients from excessive risk and prevent large account wipeouts. ESMA also requires brokers to provide negative balance protection and standardized risk warnings. While some traders move to offshore brokers for higher leverage, ESMA-regulated brokers ensure safer conditions. These restrictions highlight the trade-off between freedom and investor protection. For long-term survival, controlled leverage is often beneficial.