Contents
- •Why This Guide
- 1What a Bonus Is, and Its Types
- 2Where the Bonus Appears in Your Account
- 3Margin-Only Bonus or Loss-Absorbing Bonus?
- 4The Terms That Decide Everything
- 5Why a Broker Gives You a Bonus
- 6High Leverage in Numbers
- 7Why Brokers Offer 1:1000 and 1:2000
- 8Bonus and Leverage Together
- 9Prohibited Bonus Use
- 10Bonus Arbitrage: How It Works, and Why Its Users Usually Lose
- 11Questions Before You Accept a Bonus or Leverage
- •Disclosure and Sources
Introduction
Why This Guide#
"Deposit $1,000 and trade with $2,000." "Leverage up to 1:2000." These are two of the offers traders in our region see most often, and both look like gifts. This guide explains, in numbers, what the gift really means.
We are not saying every bonus is a trap, or that all high leverage is a mistake. We are saying both are tools with terms attached, and the terms decide whether the tool works for you or against you. Most traders accept a bonus without reading a single one of them.
A bonus is not your money, and leverage is not profit. A bonus changes when your trades are closed and what you can withdraw; leverage changes the trade size you are able to open. Neither changes anything about the direction of the market.
Chapter 1
What a Bonus Is, and Its Types#
A bonus is extra credit the broker adds to your account, with conditions. In most cases it cannot be withdrawn as cash; it is used for trading under rules set by the broker.
| Type | How it works | What to watch for |
|---|---|---|
| No-deposit welcome bonus | A small amount added when you open the account, without depositing anything. | Profits are usually capped and tied to trading volume; it is the type most open to abuse. |
| Deposit bonus | A percentage of your deposit (such as 30%, 50% or 100%) added as credit. | The most important and most consequential type — Chapters 3 and 4. |
| Trading credit | The technical form in which most bonuses are added in MetaTrader, in a field separate from your balance. | Chapter 2. |
| Cashback / rebate | An amount returned to you for every contract you trade. | The clearest and least risky type; in effect a cost reduction. |
| Contests and prizes | Prizes for the highest profit or the largest trading volume over a period. | They push traders towards risk-taking and overtrading. |
Names vary widely between brokers: what one broker calls a "tradable bonus" another may call a "non-losable bonus", and the same name can mean two different things at two brokers. So don't rely on the name; rely on the text of the terms.
Chapter 2
Where the Bonus Appears in Your Account#
To understand a bonus you need to read four fields at the bottom of the MetaTrader platform. These are the fields the broker uses to decide when your trades are closed.
| Field | What it means |
|---|---|
| Balance | Your money: your deposits plus realised profits, minus realised losses. |
| Credit | The bonus. It sits in a separate field because it is not your money. |
| Equity | Balance + Credit + profit or loss on open trades. |
| Margin and margin level | The margin held for your trades, and the ratio of equity to it. When that ratio falls to a set level, your trades are closed. |
Equity = Balance + Credit + Floating P/L
Notice that the bonus is part of equity, so it raises your margin level and delays the closing of your trades. And this is exactly where the two types of bonus differ: what happens when losses have used up your own money?
Chapter 3
Margin-Only Bonus or Loss-Absorbing Bonus?#
This is the difference that changes everything, and most traders don't know which of the two they have in their account.
Type one: a margin-only bonus#
Sometimes called "non-losable" or "for trading only". It raises your equity, allowing you to open larger trades or keep them open longer, but it absorbs no losses at all. When losses use up your own money — that is, when equity falls to the amount of the bonus — the bonus is withdrawn automatically, equity collapses and your trades are closed.
Type two: a loss-absorbing bonus#
It absorbs losses after your own money runs out. Your trades stay open and the loss keeps eating into the bonus itself until the margin level reaches the stop-out threshold.
An example in numbers#
An account with a $1,000 deposit plus a 100% bonus ($1,000) — compared with an account without a bonus. A gold buy of 0.5 lot (every $1 move = $50), leverage 1:500 at a price of 4,000, so the margin held is $400, with stop out at 50% of margin. Price falls:
| Account | When the trade is closed | Price move against you | Your own money lost |
|---|---|---|---|
| No bonus | Equity = $200 | $16 | $800 |
| Margin-only bonus | When your money is used up and the bonus is withdrawn | $20 | $1,000 |
| Loss-absorbing bonus | Equity = $200 (after $800 of the bonus is used up) | $36 | $1,000 |
What these numbers say#
- The margin-only bonus protected you from nothing: it made you lose $1,000 instead of $800, because it kept the trade open until all of your money was gone. Its only benefit is that it lets you open larger trades — which is a risk in itself.
- The loss-absorbing bonus gave you real distance: $36 instead of $16, so if price reversed before then, the trade survived. But if the move continued, you still lost all your money — and the extra distance tempts you not to use a stop.
- In both cases: a trader without a stop loses the whole account in a large move. The bonus changes when, not whether.
Look in the terms for wording such as "the bonus is removed when equity reaches the bonus amount" (margin-only), or "the bonus is used to cover losses" (loss-absorbing). If you can't find it, ask in writing before you trade.
Chapter 4
The Terms That Decide Everything#
A bonus is measured by its terms, not its percentage. A 30% bonus with clear terms may be better for you than a 100% bonus with restrictive ones.
1. The trading-volume requirement#
For the bonus — or the profits made with it — to become withdrawable, the broker usually requires a set trading volume for every dollar of bonus. The higher the requirement, the more you have to trade, the more you pay in spread and commission, and the greater the temptation to overtrade.
An illustrative example: if the requirement is one full contract for every $2 of bonus, a $1,000 bonus needs 500 contracts. On gold with a $0.30 spread, that is $15,000 in spread alone — fifteen times the bonus.
2. The effect of withdrawals — the most dangerous term#
At many brokers, any withdrawal from your balance cancels the bonus entirely, or cancels part of it in proportion to what you withdrew. And if you have open trades supported by the bonus, the cancellation may close them immediately.
An account with a $1,000 balance and a $1,000 bonus, open trades losing $700, and $400 of margin held. Equity = $1,300. The trader withdraws $300, thinking it is "spare". If a withdrawal cancels the whole bonus, equity becomes 1,300 − 300 − 1,000 = $0, and every trade is closed on the spot at its full loss.
3. Expiry#
Some bonuses expire after a period if you haven't met the trading requirement, and some are removed if the account stays inactive.
4. Profits made with the bonus#
Are the profits yours immediately, or restricted until the requirement is met? Can the broker cancel them if it sees "abuse"? And who decides what abuse is?
5. Abuse clauses#
Almost every set of bonus terms contains a clause allowing the broker to cancel the bonus and the profits, and close the account, if it suspects "abuse". That clause is legitimate against real abuse (Chapters 9 and 10), but it becomes a weapon against you if it is loosely worded and applied to any winning trader.
Chapter 5
Why a Broker Gives You a Bonus#
A broker is a commercial company, and a bonus is a marketing cost. The question is: how does that cost come back to it?
- Larger deposits: "Deposit $1,000 and get $1,000" pushes traders to deposit more than they intended.
- Higher trading volume: the volume requirement generates spread and commission for the broker, whatever the outcome of the trades.
- Longer retention: a trader waiting to meet the requirement doesn't move the account to another broker.
- Low real cost: in the internal-book model (B-Book), most bonuses never leave the broker; most accounts are closed or depleted before the withdrawal terms are met. A margin-only bonus in particular costs the broker nothing unless the trader wins.
Regulators in the European Union, the United Kingdom and Australia have imposed retail CFD restrictions that include leverage limits and restrictions on monetary or non-monetary incentives. The exact rules depend on the jurisdiction and the entity serving the client, so check the applicable regulator and terms.
Is a bonus ever genuinely useful?#
Yes, in specific cases: a loss-absorbing bonus with a reasonable volume requirement and clear withdrawal terms gives real breathing room, and cashback on every contract genuinely lowers costs. But the rule stays the same: choose the broker for its safety, cost and execution, then look at the bonus — not the other way round.
Chapter 6
High Leverage in Numbers#
Leverage doesn't change what you lose per dollar of price movement if you keep the trade size fixed. What it changes is the largest trade you can open, and how close the stop out is to you. That is where the danger lies.
A $500 account, with all the leverage used#
Gold at $4,000; a full contract is 100 ounces (worth $400,000). Here is what happens if the trader opens the largest trade their leverage allows:
| Leverage | Margin per full contract | Largest possible trade | Value of a $1 move | Move that wipes the account | Spread alone ($0.30) |
|---|---|---|---|---|---|
| 1:100 | $4,000 | 0.12 lot | $12 | ≈ $41.7 | $3.60 |
| 1:500 | $800 | 0.62 lot | $62 | ≈ $8.1 | $18.60 |
| 1:1000 | $400 | 1.25 lot | $125 | $4.0 | $37.50 |
| 1:2000 | $200 | 2.50 lot | $250 | $2.0 | $75.00 |
Simplified: it ignores the stop-out level, which comes before zero, so reality is worse than the table.
At 1:2000 with the whole account in use, a $2 move in gold — which happens within seconds on any ordinary day — wipes out the account. And the spread alone takes 15% of the account the moment you enter.
Leverage itself is not the problem#
A trader at 1:2000 who opens 0.01 lot takes exactly the same risk as a trader at 1:100 who opens 0.01 lot. The difference is that the first one can open 2.50 lots if they want to. High leverage makes a big mistake possible with a single click. So the rule remains the one in our position-sizing article: calculate your size from your stop and your risk, not from the margin available.
When is high leverage genuinely useful?#
A disciplined trader can use it to keep less money with the broker: the same trade needs less margin, so the rest of the money can stay outside the broker. That is a legitimate use — provided the trade size is still calculated from risk, not from margin.
Chapter 7
Why Brokers Offer 1:1000 and 1:2000#
Some major retail-CFD jurisdictions impose leverage limits, including limits around 1:20 for certain commodity CFDs such as gold. The applicable cap depends on the regulator, product classification and client category. So why do other brokers offer a hundred times that?
- No cap stops them: most offshore jurisdictions impose no legal cap on retail leverage.
- A marketing tool for small accounts: a trader with $100 can't open a "meaningful" trade at 1:20. High leverage lets them do so, which makes a small account feel "worth it".
- It costs the broker nothing in the internal book: if the broker doesn't hedge the trade in the market, there is no margin to pay anyone. Fully hedging 1:2000 leverage, on the other hand, is very expensive — as we explained in the "Inside the Broker" guide.
- Accounts close faster: in the internal book, a client's loss is the broker's revenue. Fully used high leverage shortens the life of an account.
Evidence from the brokers themselves: "dynamic leverage"#
Many brokers that offer 1:2000 apply "dynamic leverage":
- It falls as the account grows: for example 1:2000 for equity under a few thousand dollars, stepping down to 1:200 or less for larger accounts.
- It falls before weekends and before major news, because price gaps make high leverage a risk for the broker itself.
In other words, maximum leverage is in practice reserved for small accounts, at times the broker considers safe for itself. That alone says a lot about whom high leverage serves.
High leverage is not conclusive proof of a bad broker, but it is a strong indicator of a model built on the internal book and small accounts. And it changes nothing about the rule: a defined risk per trade, and a stop placed at the moment of entry.
Chapter 8
Bonus and Leverage Together#
Each on its own widens what you can do. Together they make the fastest way to lose a small account.
Example: a $500 deposit + a 100% bonus ($500) = $1,000 of equity, at 1:2000 leverage. Margin for a full gold contract is $200, so the trader can open 5 contracts — $500 for every $1 move. A $1 move against them wipes out their entire deposit. And if the bonus is "margin-only", it is withdrawn at that same moment and the trades are closed.
| Set-up | Largest trade | Move that wipes the deposit ($500) |
|---|---|---|
| $500, no bonus, 1:100 leverage | 0.12 lot | ≈ $41.7 |
| $500, no bonus, 1:2000 leverage | 2.50 lot | $2.0 |
| $500 + $500 bonus, 1:2000 leverage | 5.00 lot | $1.0 |
Notice that the two offers — bonus and leverage — are usually marketed together, and to the same audience: small accounts.
Chapter 9
Prohibited Bonus Use#
The bonus terms of almost every broker prohibit specific practices. Some are outright fraud; others are things traders fall into without meaning to. The result is the same either way: the bonus and the profits are cancelled, and the account may be closed.
| Practice | What it means |
|---|---|
| Multiple accounts | Opening more than one account to collect the bonus more than once — in family members' names, or from the same device or address. |
| Hedging within the broker | Buying in one account and selling in another at the same broker, or two opposite trades in the same account, to meet the volume requirement without risk. |
| Bonus arbitrage | Two opposite trades at two brokers, one of them on an account with a loss-absorbing bonus (Chapter 10). |
| Deposit-withdrawal cycles | Depositing to get the bonus, then withdrawing and re-depositing to get it again. |
| Exploiting price latency | Trading on broker prices that lag the market, or at the moment news is released, with size multiplied by the bonus. |
| Self-referral | Referring yourself or your own other accounts to earn a referral commission on top of the bonus. |
How the broker detects it#
The broker matches registration details, devices, IP addresses and payment methods across accounts, and looks for simultaneous opposite trades, volume patterns that hit the bonus requirement exactly, and trades opened at the moment of a release. Modern risk-management systems do this automatically.
Don't open bonus accounts for family members from your own device, don't hedge between your accounts, and keep a record of your trades. These practices may look innocent, but they are enough for your account to be classed as "abusive" and your profits cancelled.
Chapter 10
Bonus Arbitrage: How It Works, and Why Its Users Usually Lose#
It is promoted in trading groups as "guaranteed profit from the bonus". The idea is simple; the actual result is usually the opposite of what is promised.
The idea#
The trader opens an account at Broker A with a loss-absorbing bonus, and an account at Broker B with no bonus. They then open two opposite trades of the same size: a buy at A and a sell at B. The aim is for the bonus to pay the loss in one direction, so that the bonus amount ends up in the trader's pocket through the other account.
A simplified example#
A: $1,000 deposit + $1,000 loss-absorbing bonus, buying one gold contract. B: $2,000 deposit, selling one gold contract. Costs are not included.
| Scenario | Broker A | Broker B | Result "on paper" |
|---|---|---|---|
| Gold falls $20 | $2,000 loss: the $1,000 deposit + the $1,000 bonus | $2,000 profit | +$1,000 |
| Gold rises $20 | $2,000 profit — restricted by the bonus terms | $2,000 loss | $0 |
Why its users usually lose#
- The winning side is the one that gets reviewed: when the bonus account wins, the broker reviews it before the withdrawal. If it finds a simultaneous opposite trade — even at another broker — it cancels the profits under the abuse clause. The loss on the other account, however, is real, and nobody cancels it.
- Detection is easier than people think: matching trade times, matching sizes, and volume patterns aimed exactly at the bonus requirement. Some brokers share information about abusive accounts.
- Double the costs: spread, commission and swaps on both trades, repeated with every attempt to meet the volume requirement.
- Slippage and gaps: it only takes one account being closed at a worse price than the other in a fast move for the equation to break.
- Consequences beyond the trade: account closure, sometimes a frozen balance pending investigation, and being barred from the broker afterwards.
Bonus arbitrage breaches the terms of almost every broker, and we do not recommend it in any form. What is sold in trading groups as a "guaranteed bonus strategy" is usually this same idea, with risks the seller doesn't mention.
Chapter 11
Questions Before You Accept a Bonus or Leverage#
Before accepting any bonus#
| Question | |
|---|---|
| ☐ | Is the bonus margin-only or loss-absorbing? (By the wording of the terms, not the name.) |
| ☐ | What is the trading-volume requirement per dollar of bonus? And how much will meeting it cost me in spread and commission? |
| ☐ | What happens to the bonus if I withdraw any amount? Could that close my open trades? |
| ☐ | Are profits made with the bonus withdrawable immediately? |
| ☐ | Does the bonus expire? |
| ☐ | How do the terms define "abuse"? Is the definition specific or loose? |
| ☐ | Can I decline the bonus? (Some brokers add it automatically.) |
Before choosing your leverage#
| Question | |
|---|---|
| ☐ | Do I calculate my trade size from my stop and my risk, not from the margin available? |
| ☐ | What move would wipe out my account if I opened the largest trade my leverage allows? |
| ☐ | Is the broker's leverage dynamic? When does it fall (account size, news, weekends)? |
| ☐ | At what margin level are my trades closed? |
| ☐ | Is there negative-balance protection? |
A bonus is measured by its terms, and leverage by the trade size you actually open. Sizing from your risk can help limit exposure, but neither a bonus nor leverage removes the possibility of loss.
Closing
Disclosure and Sources#
Consultya acts as an introducing broker for a licensed partner broker and may receive disclosed commissions from that partner. Consultya does not manage client funds or provide investment advice. This guide does not name or recommend a particular broker. Numerical examples are illustrative, built on stated assumptions, and are not the terms of any specific broker.
This guide is educational and is not investment or legal advice. Consultya does not guarantee trading results. Trading contracts for difference carries a high risk of losing capital.
Sources#
- European Securities and Markets Authority (ESMA) — restrictions on CFDs for retail clients, including leverage caps and the ban on incentives.
esma.europa.eu — esma-agrees-prohibit-binary-options-and-restrict-cfds - UK FCA — PS19/18: permanent restrictions on contracts for difference.
fca.org.uk/publications/policy-statements/ps19-18 - Australia's ASIC — product intervention order: leverage caps and the ban on incentives.
asic.gov.au — 22-082MR - Loss-absorbing and non-losable bonuses, and the two modes of trading with a bonus.
capitalstreetfx.com — tradable-bonus-vs-non-tradable · nullpoint.io — credit-bonus-mt5-plugin - Broker bonus campaigns — a market study.
brokeree.com/articles/forex-bonus-campaigns - Dynamic leverage by equity, and its reduction before weekends and news.
xs.com/en/accounts/dynamic-leverage · roboforex.com — 2000-up-leverage · takeprofittech.com/glossary/dynamic_leverage - Bonus arbitrage and bonus abuse.
dbinvesting.com — forex-bonus-abuse · financemagnates.com — abuse-of-bonus-credits
© 2026 Consultya · info@consultya.co · This guide is educational and is not investment advice.