Recurring question. Decided to give it a proper answer since short answers can be a bit misleading.
How leverage works
First, the basics. Leverage is very similar to a loan from the broker. If the broker gives me 1:10 leverage what it means is I need to put up 10% of the cost of the trade, the broker puts up the other 90%. The broker will then set my account to auto close my trades if I lose something like 8% - protecting their share of the trade from the risk of my position.
This creates the famous double-edged sword of leverage. If my trade gains in value I can be winning at a rate of 10* faster but if the trade goes against me I can lose all the capital I have to back the trade really quickly. Quick money can be made and margin calls can be hit. When you hear of "Liquidations" "Margin calls", this is the broker protecting their portion of the risk.
Leverage on account
Where things tend to get a bit confused is when people ask me what I leverage I am using I generally tell them the leverage I have available. My account leverage. But this is not always (Almost never) the amount of leverage I am using. It's the amount of leverage I have. It dictates the maximum position size I can have - but this does not dictate the minimum position size I have.
Let's take a simple example of trading the SPX, while the SPX is priced $4,700. If I put $4,700 into a CFD trading account and I open a trade to risk $1 of my account per $1 move in the SPX, I have an unleveraged SPX position. If it goes up or down X% I mirror the same gain/loss. This is decided by the position size I have on.
It is not decided by the leverage I have. If I've got an account with 1:10 leverage and another account with 1:100 leverage both accounts will be risking the same if they are $4,700 and trading the SPX 1:1. What differs is my margin requirements. If I am using 1:10 I need $470 to back my trade. If I am using 1:100 I need $4.70 to back my trade.
So let's take a simple example of three $4,700 accounts. One without leverage, one with 1:10 and one with 1:100. If I open up the 1:1 trade with no leverage I am using all of my spending power. I can not open more trades. It requires $4,700 to back my position. But with 1:10 I am using 1/10th of my margin. 1:100 and I am using only 1% of my margin to trade SPX 1:1.
This means I have the option to trade SPX between $10 to $1 move in the underlying to $100 to $1 move in the underlying. It means I have "Free margin" to make more trades. But ultimately it is position sizing that decides the PL. If I am unleveraged or leveraged 1:100 but both accounts trade 1:1 risk with the SPX these are entirely identical positions.
Flexible application of leverage
On a trade to trade basis I determine how much leverage I want to use. Most of the time I am trading with a fixed risk on the trade of a certain percentage of risk per trade. Doing this is going to make the leverage I use a variable but it's not the important one for me. My important variables are what percentage of my account I want to risk and over how many points move in the SPX do I want to risk it.
If I wanted to risk 1% of my $4,700 a move of $47 in the SPX, this would be an unleveraged position. If I wanted to risk 1% on a move of $23.50 I'd have to double my position size. If my account was $4,700 at this point I'd have to be using leverage. I'd be leveraged 1:2. If I wanted to risk 1% of my account on a move of $4.70 I'd have to leverage my account 1:10 to get this exposure.
So the amount of leveraged used varies depending upon the amount the trade can move against me before I'd stop out and how much I want to risk per trade. These things inform my position size and from there the position size will be dictate how much leverage I am using. The amount of leverage I am using does not dictate my net risk (Assuming stops will fill) - all it dictates is how big/small a price move it takes to get me there.
The short answer to how much leverage I can have is pretty much "Infinite". IC Markets will give me up to 1:500 leverage. RoboForex will give me 1:1000 on small accounts. 1:500 is essentially infinite. Trading full leverage on these you'd go bust if it moved the tiniest bit against you. Anything over 1:500 leverage is essentially redundant. Here in the UK I am not capped on 1:30 leverage but using different brokers around the world I can easily access "More leverage than is needed".
Position sizing and leverage are not one in the same
Leverage is not well understood, or only understood in the most simplistic terms (3* ETF, for example). People are often of the opinion all leverage is always used all the time. I've had comments on this when I've posted results collections where the stats trackers also display my account leverage (See above). But just because I hypothetically could leverage 1:500 - it does not mean I do.
One of my favourite things to do when doing any sort of training stuff (Typically something like teaching people how to trade by rules/standards for prop shops or other pro entities) my favourite thing to do is to give them an account with 1:500 leverage on it and tell them to risk under 0.5% in any position.
The purpose of this is to see how well people self control. I could just as easily give them an account leverage 1:1 and essentially force them to trade the risk per position I've dictates (By controlling the position size and knowing the ATR of the market being traded). But I give them super leveraged accounts where they have the choice of how to size their positions.
How much leverage is suitable to use?
This is a question that lacks full context. It's like asking me "What train should I get?" ...."To go where?" The amount of leverage a person can use in Bitcoin which swings 5 - 10% over a few candles is entirely different from the amount of leverage someone can use in a Forex trade where a massive one day move would be about 0.25%.
Leveraging BTC 1:20 would be a bust on the wrong side of the trade, leveraging the Forex trade would lose 5%. Similarly if you take something like AMC against AMZN the amount you could leverage based on the ATR's are very different. The suitable amount of leverage depends upon the volatility of the underlying and where your stop loss is.
Most of the time when you see people talking about wild leveraged risks in CFDs people are taking in things like BTC they're actually referring to the account leverage available (Not understanding the various aspects of leverage I've explained here and thinking it's always just a simple ETF like example). To gain the exposure I want oftentimes I'll need to leverage a Forex trade at least 1:10. Many times I am under leveraged on a BTC trade (A 10% move in the underlying reflecting as a 2% move in my account).
How much I'd leverage on a SPX trade, a BTC trade and a EURUSD trade are all entirely different questions. The simple answer is the more volatile the underlying asset is the more risky applying leverage to it is. The more risk you apply with leverage the more experience or luck you need. As a general rule, the more you see inexperienced people leveraging up in an asset class - the more the market "Feels lucky" (Read: Is bubbling).
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