Yes, this is what I'm talking about, returns on cash in the account using whatever leverage size. Your points about position size are trivial... You need to do the math and you'll see that 2x leverage does not double both drawdown and return on the CASH balance. The first post I posted in this thread shows this using a normal trade distribution. Do some research on how annual returns are calculated and then run the numbers, I think you'll see what I am saying. Mike
I agree with these points from Alex. More leverage would likely change the system or style of trading, so that returns are less volatile. For instance, to keep drawdowns minimal, you would not necessarily use extra leverage all of the time. In fact, you can now use 100 shares or smaller size on "riskier" or more "volatile" trades/executions. More leverage adds to your account by increasing the volatility of more nuanced moves. A five-cent move on 1000 shares or 10x share size is now a much greater change in P/L. And a 5-cent move with 100 shares or 1x is negligible. So leverage can also mean an adjustment in risk management, also known as adjusting one's "system" to fit the cash deposit/account size, and leverage or margin available.