Leverage is a financial instrument that allows traders to trade larger amounts of money than they have in their account. It is commonly used in the forex market to increase the purchasing power of traders. Leverage is usually expressed as a ratio, such as 50:1 or 100:1, which means that for every $1 in the trader's account, they can trade up to $50 or $100. Leverage can be a great benefit to traders because it allows them to trade larger positions without having to put up the full amount of capital. However, it also comes with great risk because traders are borrowing money to trade and can lose more than their initial investment if the trade is not successful.