Leverage Ladder
See how leverage multiplies both gains and losses at different levels. Compare 2x, 5x, 10x, 20x, and 50x leverage side-by-side to understand the exponential nature of leverage risk. Each rung of the ladder shows how outcomes amplify.
Enter your account size, leverage levels to compare (comma-separated), price move scenarios, entry price, and maintenance margin. See P&L ladder, gain/loss multipliers, liquidation thresholds, and risk/reward comparison.
Your trading capital
Comma-separated leverage levels to compare (e.g., 2,5,10,20,50)
Comma-separated price moves to analyze (e.g., -10,-5,0,5,10)
Entry price for the position
Exchange maintenance margin requirement (typically 0.5-1%)
2x Leverage
Liquidation Distance
49.50%
5x Leverage
Liquidation Distance
19.50%
10x Leverage
Liquidation Distance
9.50%
20x Leverage
Liquidation Distance
4.50%
50x Leverage
Liquidation Distance
1.50%
Want these limits enforced automatically?
Jungle Rebounder helps execute structured strategies with hard caps.
See Jungle RebounderP&L Ladder by Leverage
Account value change (%) for each leverage level at different price moves. Higher leverage = larger swings.
Liquidation Thresholds
Price move distance that will liquidate your position at each leverage level. Higher leverage = liquidation closer to entry.
Gain/Loss Multipliers
How much your account changes per 1% price move at each leverage level. 10x leverage = 10% account change per 1% price move.
Detailed P&L Breakdown
2x Leverage
$8,000
$9,000
$10,000
$11,000
$12,000
5x Leverage
$5,000
$7,500
$10,000
$12,500
$15,000
10x Leverage
$5,000
$10,000
$15,000
$20,000
20x Leverage
$10,000
$20,000
$30,000
50x Leverage
$10,000
$35,000
$60,000
How It Works
Calculation Methodology
This tool visualizes how leverage multiplies both gains and losses at different levels. It shows the "ladder" of risk and reward — each rung (leverage level) amplifies outcomes. Higher leverage = higher rungs = more extreme outcomes.
Key Insight: Leverage amplifies both gains and losses equally. 10x leverage means a 10% price move = 100% account change. 50x leverage means a 2% price move = 100% account change. The problem is that liquidation gets closer to entry as leverage increases. At 50x leverage, a tiny 1.5% move liquidates you. Normal market volatility (1-2%) can wipe out high-leverage positions. This is why professional traders use 2-5x leverage, not 50x+.
Learn more about leverage:
Leverage and margin guideExample Scenario
Setup: $10,000 account, comparing 2x, 5x, 10x, 20x, 50x leverage, 5% price move
What this means: The same 5% price move produces vastly different outcomes at different leverage levels. 2x leverage gives 10% account gain with liquidation far away (49.5% down). 50x leverage gives 250% account gain but liquidation is extremely close (1.5% down). Higher leverage = larger potential gains but also much higher liquidation risk.
Common Mistakes & Warnings
- ⚠Using maximum leverage: Maximum leverage (50x, 100x) brings liquidation extremely close to entry. A tiny 1-2% move can wipe you out. This is gambling, not trading.
- ⚠Not understanding the multiplier: 10x leverage means 10% account change per 1% price move. A 5% move = 50% account change. Small price moves have massive account impact.
- ⚠Ignoring liquidation thresholds: Higher leverage brings liquidation closer to entry. At 50x leverage, liquidation is only 1.5% away. Normal market volatility can liquidate you.
- ⚠Focusing only on gains: Leverage amplifies losses just as much as gains. A -5% move with 10x leverage = -50% account. The asymmetry comes from liquidation risk, not the multiplier itself.
Example Scenarios
Try these realistic scenarios to understand leverage amplification at different levels.
Scenario 1: Conservative Leverage (2x, 5x)
Low leverage. Manageable risk with reasonable amplification.
What this means: Conservative leverage provides reasonable amplification with manageable liquidation risk. 2x leverage means 10% move = 20% account change. 5x leverage means 10% move = 50% account change. Liquidation is far from entry, providing buffer for normal market movements.
Scenario 2: Moderate Leverage (10x, 20x)
High leverage. Significant amplification with high liquidation risk.
What this means: Moderate leverage provides significant amplification but brings liquidation close to entry. 10x leverage means 10% move = 100% account change. 20x leverage means 5% move = 100% account change. Liquidation is close to entry, making normal market movements dangerous.
Scenario 3: Extreme Leverage (50x, 100x)
Extreme leverage. Massive amplification with very high liquidation risk.
What this means: Extreme leverage provides massive amplification but brings liquidation extremely close to entry. 50x leverage means 2% move = 100% account change. 100x leverage means 1% move = 100% account change. Liquidation is very close to entry, making even tiny market movements dangerous. This is gambling, not trading.
Frequently Asked Questions
When should I use this tool?
Use this tool to understand how leverage amplifies both gains and losses at different levels. Compare multiple leverage levels side-by-side to see how 2x, 5x, 10x, 20x, and 50x affect your P&L for the same price move. This helps you visualize the exponential nature of leverage risk.
What is a leverage ladder?
A leverage ladder shows how different leverage levels (2x, 5x, 10x, etc.) affect your P&L for the same price movement. It visualizes the 'ladder' of risk and reward — each rung (leverage level) multiplies both potential gains and losses. Higher leverage = higher rungs = more extreme outcomes.
How are gain/loss multipliers calculated?
Gain/loss multiplier = leverage × price move percentage. For example, with 10x leverage and 5% price move: multiplier = 10 × 5% = 50% account change. With 50x leverage and 5% price move: multiplier = 50 × 5% = 250% account change. The multiplier shows how leverage amplifies price movements.
What are liquidation thresholds?
Liquidation threshold is the price move that will liquidate your position. For long positions: liquidation distance = (1 / leverage) - maintenanceMargin. For example, 10x leverage with 0.5% maintenance margin: liquidation = 9.5% down. Higher leverage = liquidation closer to entry price.
How does leverage affect risk/reward?
Leverage amplifies both risk and reward equally. 10x leverage means 10% price move = 100% account change (gain or loss). The risk/reward ratio stays the same, but the magnitude of outcomes increases. Higher leverage = larger potential gains but also larger potential losses — the asymmetry comes from liquidation risk.
Why is higher leverage more dangerous?
Higher leverage brings liquidation closer to entry. With 10x leverage, you can survive a 9% move against you. With 50x leverage, only a 1.5% move. Normal market volatility (1-2%) can liquidate high-leverage positions. The risk isn't just larger losses — it's that small moves can wipe you out completely.
What's the difference between this and Optimal Leverage Calculator?
Optimal Leverage Calculator finds safe leverage for risk management. Leverage Ladder visualizes how leverage multiplies outcomes across different levels. One helps you choose leverage, one helps you understand leverage. They're complementary — use Optimal Leverage to find safe levels, Leverage Ladder to see why higher levels are dangerous.
Should I use maximum leverage?
No — maximum leverage (using all margin) is extremely dangerous. Even with proper position sizing, high leverage brings liquidation close to entry. Use the Optimal Leverage Calculator to find safe leverage levels (typically 2-5x for most traders). Leverage Ladder shows why maxing out leverage is risky.
How do I interpret the P&L ladder?
The P&L ladder shows account value changes for each leverage level at different price moves. Each 'rung' represents a leverage level. Higher rungs (more leverage) show larger swings. Look for where liquidation occurs — that's the danger zone. The ladder helps you see the exponential nature of leverage risk.
What's a safe leverage level?
Safe leverage depends on volatility, stop distance, and risk tolerance. For most traders, 2-5x leverage is reasonable. 10x is high risk. 20x+ is extremely risky. Use the Optimal Leverage Calculator to find your safe level, then use Leverage Ladder to see how outcomes change at different levels.
Related Tools
Degenerate Recovery Simulator
Calculate how many 10x/100x trades needed to recover from massive drawdowns. See probability of recovery, expected trades before ruin, and recovery timeline scenarios.
1 matching tag
YOLO Leverage Calculator
Calculate how much leverage you need to 10x/100x your account and see how likely you are to get liquidated. Shows required leverage, liquidation probability, degeneracy score, and expected time to liquidation.
Similar use case