Your true leverage — and the move that wipes equity.
The wipe-out figure ignores margin calls, spreads and gaps — real accounts get stopped out before equity reaches zero.
Educational tool only — not financial advice. Verify figures with your broker.
The Effective Leverage Calculator is a risk tool that reveals your true leverage: how large your total open exposure is relative to your account equity, not the nominal leverage your broker offers. It answers 'how leveraged am I really right now, and what size of adverse move would wipe my equity?'
Effective leverage = total open exposure / account equity. Equity as a percentage of exposure = equity / exposure x 100, which is the inverse of the leverage figure. The adverse move that wipes equity = 1 / effective leverage (as a percentage) e.g. 11x effective leverage implies roughly a 9% adverse move to zero equity, ignoring frictions.
Effective leverage is your total open exposure divided by your account equity. It reflects how leveraged you actually are across all open positions, which can differ sharply from your broker's headline leverage.
It takes the inverse of your effective leverage: at 10x effective leverage, a roughly 10% adverse move against your exposure equals your entire equity. It is a theoretical illustration of how thin your buffer is.
Lower leverage means a larger adverse move is needed to wipe equity, giving more buffer, but this calculator does not judge what level is right for you or whether a strategy is sound.
Keep in mind: The wipe-out figure ignores margin calls, spreads and gaps: real accounts get stopped out before equity reaches zero, so treat it as an illustration of how thin your buffer is, not a literal survival threshold.