How to Get Leverage on Stocks: Brokerages vs Perps

TL;DR: Retail traders today get leverage on stocks through four products: margin, options, leveraged ETFs, and index futures. Alpha offers something different: access to perpetual futures with up to 100x leverage on single names, 24 hours a day, right from your phone. This piece walks through how leverage works across the largest retail brokerages by trading volume — Charles Schwab, Fidelity, Interactive Brokers, Robinhood, and Webull — and how platforms like Alpha are different.

You wanted to short a stock you knew was overbought. Your broker told you the shares weren't available to borrow.

You bought the option because the move was obvious. It played out the next morning, twelve hours after your contract expired worthless.

You held a leveraged ETF through a sideways week and watched it bleed money the index didn't lose.

Retail traders have always been able to get leverage on stocks. The largest retail brokerages by trading volume all offer multiple paths to leveraged exposure. Margin accounts. Options. Leveraged ETFs. Index futures. The mechanics work. Millions of traders use them every day.

But each path costs something specific. Interest. Time. Decay. Approval flow. Alpha is built around a product with a different set of trade-offs.

What Alpha is

Alpha is a mobile-first platform where users can access perpetual futures on stocks, indices, commodities, and crypto. You pick your asset. You pick your leverage — anywhere from 1x to 100x. You go long or short. You place your trade. It's that simple.

Instead of paying interest on a margin loan or watching an option decay, you pay or receive a funding rate at regular intervals. Funding is a periodic payment exchanged between long and short holders of a perpetual contract, used to keep the contract price aligned with the spot price of the underlying asset. When more traders are positioned long, longs pay shorts. When the trade is crowded short, shorts pay longs. The rate moves with the market.

A perpetual future is one of the simplest ways to express leverage because you can focus purely on getting the direction right, without worrying about greeks, expiry dates, or all the other variables on other leverage products.

The rest of this piece walks through what trading with leverage looks like across the industry today, so you can see exactly where Alpha sits relative to the alternatives.

The four most common ways to trade stocks with leverage

Across the largest retail brokerages by trading volume, leveraged exposure comes through one of four products. Most active traders use more than one.

Margin

You put up part of the position value in cash. The broker lends you the rest. You hold more stock than your cash could have bought.

How it trades: you pay interest on the borrowed money, calculated daily and charged monthly. Standard margin delivers roughly 2x leverage on most stocks. You own the shares — dividends, voting rights, and all the mechanics of equity ownership stay intact. If your equity drops below the maintenance line set by your broker, the broker can close the position without notice — at Interactive Brokers, for instance, real-time automatic liquidations replace traditional margin calls when an account falls below requirement.

The trade-off: cash flow to interest charges, and a separate margin agreement, minimum balance, and broker approval before you can use it.

Options

You buy a contract that gives you the right to buy or sell 100 shares at a set price by a set date. A small premium controls a big position.

How it trades: the contract's price moves with the underlying stock, but it also drops every day from time decay — traders call it theta. It drops when implied volatility falls, even if the underlying stock moves your way. And it expires on a fixed date. The upside is defined-risk asymmetry — your loss is capped at the premium, and your gain can be many multiples of it. Used well, options let you express specific views on direction, timing, and volatility that other products can't.

The trade-off: time. Every day you hold the contract is a day theta takes a piece of it, and you have to be right on direction and timing before expiration.

Leveraged ETFs

You buy a fund that uses derivatives to deliver 2x or 3x the daily return of an index. No expiration. No greeks. Trades like a regular stock in a standard brokerage account.

How it trades: it works as advertised for a one-day directional trade — and for traders who want simple, no-approval-needed leveraged exposure to an index, that's the entire appeal. Hold longer than a day in a market that isn't trending cleanly, and the daily reset compounds against you. Traders call this volatility drag.

The trade-off: holding period and product depth. Single-stock leveraged ETFs exist but are limited to a relatively small set of large-cap names — NVDA, TSLA, AAPL, and a few dozen others — and they're built for short holds, not long ones. The 2x or 3x daily reset compounds against you in any market that isn't trending cleanly.

Index futures

You trade a contract on an index — most commonly the S&P 500 or Nasdaq 100 — with significant leverage built in. You post a fraction of the contract's value as initial margin. Interactive Brokers notes that margin can be set at 5–15% of the notional value the futures contract represents, depending on the contract's volatility history.

How it trades: the leverage is real, the markets run nearly 24 hours, and the products are deep, liquid, and battle-tested — index futures are how professional traders express macro views. One S&P 500 futures contract represents around a quarter million dollars of exposure. You need a separate futures account, separate approvals, and an understanding of contract specs and roll dates.

The trade-off: single-name stock exposure (most retail platforms don't offer single-stock futures) and accessibility — futures carry a heavier learning curve and bigger contract sizes than most retail accounts can size precisely.

How leverage works across the largest retail brokerages by trading volume

The four products above show up across the major retail brokerages, but each platform offers a different combination of approvals, pricing, and product depth. The brokerages below are widely considered among the largest by retail trading volume and serve as illustrative examples of how leverage is offered across the industry.

Charles Schwab

Charles Schwab offers margin accounts, full options trading, leveraged ETFs through standard equity trading, and a full futures and forex suite through its thinkorswim platform. Schwab acquired TD Ameritrade in 2020 and completed the thinkorswim integration in 2024, as part of an expansion into these more flexible trading types. In April 2024, Schwab launched futures, forex, and portfolio margin on the thinkorswim platform suite. As of December 2025, Schwab's base margin interest rate is 10.00%. Full leverage coverage on Schwab requires three separate approvals — margin, options, and futures via thinkorswim.

Fidelity

Fidelity offers margin accounts, full options trading, and access to leveraged ETFs through standard stock trading. Fidelity does not currently offer futures trading for retail accounts — the platform supports stocks, ETFs, options, bonds, mutual funds, and crypto, but futures and forex are not available. As of December 2025, Fidelity's margin rate is 7.50% for balances over $1 million, with higher rates on smaller balances. Margin and options each require separate approval flows; for futures coverage, a Fidelity customer would need a second broker.

Interactive Brokers

Interactive Brokers (IBKR) offers margin (with portfolio margin available for qualifying accounts at higher leverage ratios under SEC-approved rules), full options trading, leveraged ETFs, and futures across more than 30 markets. IBKR's margin rates are widely considered among the lowest in the industry, with a risk-based real-time margin system that can reduce requirements for diversified portfolios. In Q3 2025, IBKR reported 3.62 million total daily average revenue trades (DARTs), up 34% year-over-year. Approvals are bundled but require trading history for higher-tier products. Generally considered the most leverage-flexible major retail brokerage, with a steeper learning curve than mobile-first platforms.

Robinhood

Robinhood offers margin accounts (with rates available to all customers, lowered from previous Gold-only pricing), options trading across approval tiers, leveraged ETFs through standard stock trading, and futures trading. Robinhood launched in-app futures trading in October 2024 alongside its Legend desktop platform. In January 2025, Robinhood expanded its futures offering with CME Group products, giving eligible customers access to futures on the S&P 500, Nasdaq-100, Russell 2000, Dow Jones, bitcoin, ether, FX pairs, metals, and commodities. As of late 2025, Robinhood's margin rates range from 5% to 6.75%, tiered by balance. The platform is mobile-first, with margin, options, and futures each requiring separate enablement.

Webull

Webull offers margin accounts with tiered rates, options trading, leveraged ETFs, and futures trading. Webull launched futures and commodities trading in March 2024 and has since expanded its futures offering, including crypto futures through a partnership with Coinbase Derivatives. Standard margin rate is in the high single digits, with a discounted rate of around 5.75% available to Webull Premium subscribers. Futures trades are priced at $1.25 per contract, and a separate futures account is required to trade them.

The industry pattern

To run a full leveraged trading strategy across single names and indexes through the largest retail brokerages, a trader typically needs two or three separate approvals, multiple product types to learn, and in some cases a second broker for futures coverage. Leverage is available across the industry. It just lives in pieces.

How trading on Alpha works

Alpha is built around access to one product: equity perpetual futures (perps).

You pick a single asset. You pick your leverage, anywhere from 1x to 100x. You go long or short. The position tracks the underlying stock continuously, with no expiration.

Instead of paying interest on a margin loan or losing value to time decay, you pay or receive a funding rate at regular intervals. When more traders are long than short, longs pay shorts. When the trade is crowded the other way, shorts pay longs. The rate moves with the market.

The leverage you pick is the leverage you get. A 1x position is a directional bet with no borrowed capital. A 10x position controls ten times the cash you post — which means a 1% move in the underlying stock is a 10% move in your PnL, in either direction. Past the maintenance line, known as your liquidation level, the position closes automatically. The mechanics of liquidation are the same as any leveraged product. At 10x they just happen faster.

What you give up: when funding is against your direction, you pay it. High leverage compounds small mistakes — position size matters more than the leverage figure itself. And like every leveraged product, your position can be liquidated if it moves against you.

What's different from the trader's side: one account, one product, no separate approval tiers, no expirations to track, no theta, no daily reset, 24/5 markets, and a platform built for mobile from the ground up.

The trade-offs, side by side

What changes for the trader

Every leveraged product has a cost of holding the position. On margin, it's interest. On options, it's theta. On leveraged ETFs, it's volatility drag. On index futures, it's the roll. These costs don't care whether your trade is working. They charge you the same either way.

Perps replace those fixed costs with a funding rate that moves with the market. When the trade is crowded against your direction, you receive funding. When the trade is crowded with you, you pay it. The cost is dynamic instead of constant.

The other change is structural. Instead of running three or four separate products through three or four separate approval flows to cover the trades you want to take, you run one product with the leverage as a dial. The single name you have a view on, the direction you have a view on, the leverage you choose — that's the entire trade.

Leverage is risk in both directions on every product on this page. A 10x position can liquidate on a 10% move against you, and 10% moves happen often, especially around volatile sessions like earnings. Position sizing is similarly as important as the leverage figure itself. Volatility can liquidate you. Risk management isn't optional on any leveraged product.

That's the price of admission to leveraged trading anywhere. The question is which trade-off fits the trade you want to make. Margin trades cash flow for shares you own. Options trade time for asymmetric payoff. Leveraged ETFs trade holding period for index exposure. Index futures trade single-name exposure for size. Perps trade a floating funding rate — paid when positioning is with you, received when it's against you — for 100x leverage on a single name, 24/5, on mobile. None of them is a replacement for the others. Each one is a different bet on what costs you're willing to carry.

FAQ

What are the main ways to trade stocks with leverage?

Across the largest retail brokerages by trading volume, the four common paths are margin accounts (borrowing from the broker, typically around 2x leverage), options (contracts giving synthetic leverage with time decay and expirations), leveraged ETFs (2x or 3x daily exposure to indexes, with volatility drag in choppy markets), and index futures (high leverage on index contracts, with separate account requirements). Alpha adds a fifth path: equity perpetual futures with leverage up to 100x on single names.

What is an equity perpetual future?

An equity perpetual future is a derivative contract that tracks the price of an underlying stock without an expiration date. The trader doesn't own the underlying shares — they hold a contract that moves with the price. Instead of paying interest on borrowed funds, holders pay or receive a funding rate at regular intervals to keep the contract price aligned with the spot price. Equity perpetual futures are the core product on Alpha.

What's the difference between margin and perpetual futures?

Margin is a cash loan from a broker that lets a trader buy more shares than their balance allows. The trader owns the shares and pays interest on the loan. A perpetual future is a derivative contract that tracks the price of an asset without the trader owning the asset. There's no loan and no interest charge. Instead, holders pay or receive a funding rate to keep the contract price aligned with the underlying stock.

What is a funding rate in perpetual futures?

A funding rate is a periodic payment exchanged between holders of long and short positions in a perpetual contract. It keeps the contract price in line with the underlying spot price. When more traders are long than short, longs pay shorts. When shorts are more crowded, shorts pay longs. The rate floats with market positioning.

Why do leveraged ETFs lose value over time?

Leveraged ETFs reset their leverage every day. In a market that moves up and down without a clear trend, the daily reset compounds against the holder, even when the underlying index ends flat over the period. This is called volatility drag and is a structural feature of how leveraged ETFs are constructed. It's why leveraged ETFs are designed for short holds, not long ones.

Can you get 100x leverage on a single stock?

Through traditional retail brokerages, no. Margin accounts typically deliver around 2x leverage on most stocks. Options give synthetic leverage that decays with time. Leveraged ETFs cap at 3x daily. Index futures offer higher leverage but only on indexes, not single names. Equity perpetual futures, like the ones accessed via Alpha, can offer up to 100x leverage on single-name assets.

How does leverage work on Charles Schwab?

Schwab offers margin accounts, full options trading, leveraged ETFs through standard equity trading, and futures and forex through its thinkorswim platform. Full leverage coverage requires three separate approvals — margin, options, and futures via thinkorswim.

How does leverage work on Fidelity?

Fidelity offers margin and options across approval tiers, plus access to leveraged ETFs through standard stock trades. Fidelity does not currently offer futures trading. Margin and options each require separate approval flows; for futures, a trader would need a separate broker.

How does leverage work on Interactive Brokers?

Interactive Brokers offers margin (with portfolio margin available for qualifying accounts), full options trading, leveraged ETFs, and futures across more than 30 markets. It's generally considered the most leverage-flexible major retail brokerage, with a steeper learning curve than mobile-first platforms.

How does leverage work on Robinhood?

Robinhood offers margin, options trading across approval tiers, leveraged ETFs, and futures trading (launched October 2024 and expanded with CME Group products in January 2025). The platform is mobile-first, with margin, options, and futures each requiring separate enablement.

How does leverage work on Webull?

Webull offers margin accounts with tiered rates, options trading, leveraged ETFs, and futures trading (launched March 2024) through a separate futures account. Mobile-first design.

What is the cost of holding a leveraged position?

Every leveraged product has a cost of holding the position. On margin, it's interest on the borrowed funds. On options, it's theta — time decay that takes a piece of the contract every day. On leveraged ETFs, it's volatility drag from the daily reset. On index futures, it's roll costs when contracts approach expiration. On perpetual futures, like those accessed via Alpha, it's a funding rate that floats with market positioning — sometimes paid, sometimes received, depending on which side of the trade is crowded. Each cost behaves differently. None of them is zero.

Is Alpha available in my country?

Availability varies by jurisdiction. Check tradealpha.app for current availability.

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