Trade with Multiplier at IQ Option

Trade with Multiplier at IQ Option

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In their latest guide, IQ Option have drawn attention to the risky yet rewarding multiplier option that they have in place on their trading platform.

In a nutshell, the multiplier allows traders to “manage a position that is greater than the amount of funds at his disposal” according to IQ Option. Already by the name “multiplier” it may give you a little insight into how this trading option at IQ Option may help you do that. Indeed, you would be on the right track. When in use, it will calculate profits or losses reflective of the multiplier you have in place.

In the example that IQ Option provides is that in “a $100 deal and using an x5 multiplier your potential profit (and loss) will be calculated as if you were investing $500”. Therefore, it allows you to essentially invest with money you don’t have at your disposal. Of course, this means that whatever multiplier you choose to apply, it will multiplier potential earnings by that if you make the right call but it will also multiply losses if the market takes a dive.

With this considered, it is by nature a very dangerous tool in some instances, but that increased risk is also reflected in the potential benefits on offer. Therefore, the key thing here is that it needs to be used with extreme caution. The most important factor to consider is that it should be used in situations where price movement can be accurately measured. It is certainly not a tool to use on more unpredictable investment options.

It was originally designed to be used on the ForEx market. As IQ Option explains that the reason this is that “currency pairs do not usually demonstrate big price swings, their daily changes are barely enough for traders to speculate on them. Traders turn to a multiplier in order to speculate on small price differences and still receive substantial results.”

However, the tool can be used effectively on most trading products, including Stocks, commodities, and ETFs. The only thing that you do need to consider before opting to use the option is what is important for each investment you wish to use the multiplier on. Specifically, are you going to prioritise lower risk or higher returns?. This decision will determine whether or not you should be using the multiplier.

IQ Option has emphasised the importance of risk management in regards to this and it should be only used by those who know exactly what they are doing. As we have mentioned, the reason for this is because the upside and the loss are multiplied respectively. Therefore, earning money will come at the same rate as losing money and so, if the latter occurs, your losses can be great. As such, IQ Option advises to “avoid using this tool when uncertain about the deal you are about to open”.

If you want to take that risk, then you can choose to use a multiplier when using Forex or Stocks by choosing it from the available trading instruments you find at the top of the screen. You can then choose the multiplier you wish to apply before opening the deal. The size of this will depend on the particular asset you wish to choose. Naturally, the larger the multiplier the higher the potential increased earnings – but also the higher level of risk and loss.

There are many other trading techniques that can and probably should be used before this option, – some of which IQ Option have already created guides about. If you understand the risks attached but still ant to apply the multiplier to your trading though go their platform now.

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