<h2>Degree of Combined Leverage</h2>
<p>The <strong>degree of combined leverage</strong> is a crucial risk management concept in forex and CFD trading. It represents the total leverage effect when trading multiple instruments simultaneously. This term is particularly relevant for traders using platforms like MetaTrader 5, which allows for multi-asset trading.</p>

<h2>How It Works</h2>
<p>When trading with leverage, each instrument contributes to the overall degree of combined leverage. The formula to calculate it is:</p>
<table>
  <tr>
    <td><strong>Degree of Combined Leverage</strong></td>
    <td>=</td>
    <td>∑(Leverage of Instrument * Size of Position)</td>
  </tr>
</table>
<p>Here's a breakdown:</p>
<ul>
  <li><strong>Leverage of Instrument</strong>: The maximum leverage provided by the broker for that specific instrument (e.g., 30:1 for major currency pairs at STB Provider).</li>
  <li><strong>Size of Position</strong>: The notional value of the position in that instrument.</li>
</ul>

<h2>Why It Matters for Traders</h2>
<p>Understanding the degree of combined leverage is vital for several reasons:</p>
<ul>
  <li><strong>Risk Management</strong>: It helps traders monitor and control their overall risk exposure. High combined leverage can amplify both profits and losses.</li>
  <li><strong>Margin Requirements</strong>: It determines the total margin required to maintain open positions. Higher combined leverage means more capital is tied up in margin requirements.</li>
  <li><strong>Stop-Loss Levels</strong>: It affects the placement of stop-loss orders. With higher combined leverage, stop-loss levels may be triggered more easily.</li>
</ul>

<h2>Example</h2>
<p>Let's say a trader at STB Provider has the following positions open on MetaTrader 5:</p>
<ul>
  <li>1 lot EUR/USD at 30:1 leverage</li>
  <li>0.5 lots GBP/USD at 20:1 leverage</li>
  <li>1 lot DAX30 CFD at 200:1 leverage</li>
</ul>
<p>The degree of combined leverage would be:</p>
<table>
  <tr>
    <td>30 * 1 + 20 * 0.5 + 200 * 1 = 30 + 10 + 200 = 240</td>
  </tr>
</table>
<p>So, the trader's degree of combined leverage is 240:1.</p>

<h2>Key Takeaways</h2>
<ul>
  <li>The degree of combined leverage is the total leverage effect when trading multiple instruments.</li>
  <li>It's calculated by summing the product of each instrument's leverage and position size.</li>
  <li>Understanding and monitoring the degree of combined leverage is crucial for effective risk management.</li>
</ul>