Ripple leveraged trading vs investing
When you buy ripple with IG, you aren’t actually taking ownership of any cryptocurrency: you’re speculating on the price movements of XRP against the US dollar. But your exposure to XRP’s price movements is the same as if you’d bought it outright.
On an exchange, you’d usually sell USD to buy XRP. If ripple’s price rises, then you can sell your XRP for more USD than you paid for it, earning a profit. If you buy ripple with IG, then you’re opening a position that will increase in value as XRP’s price rises against dollar. With both, you’ll make a loss if its price goes down.
When you deal ripple using leverage, however, you only have to put down a fraction of your position’s full size as a deposit to start trading. That makes leveraged trading a powerful tool, but it also makes it risky – including the risk that your losses could exceed that original deposit.
With IG, you can trade ripple via CFDs. This allows you to go short on ripple as well as long, which means that your position will increase in value if ripple goes down against the dollar. If you go short and ripple’s price goes up, you’d make a loss.