Exposure
Also called: position value, notional value
The full market value of a position, which can be much larger than the money put up to hold it.
Leverage is exposure divided by the trader's own capital. Judging risk by exposure rather than by the margin or premium paid shows how large a position really is.
Example
Controlling ₹5 lakh of shares with ₹1 lakh of capital is ₹5 lakh of exposure and five times leverage.
Learn more in these lessons
- Leverage and marginHow does leverage turn small price moves into large gains and losses?
Related terms
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