I understand how positions can offset and cancel each other out. What I don&#x27;t understand is if the notional value is never fully redeemed, why use leverage at all? That is, if only the spot prices are used to actually exchange money, why inflate the value of a trade with leverage?<p>I apologize if I&#x27;m misusing terms - I&#x27;m not a finance expert.<p>The only explanation I can think of is that leverage is used to exploit dumb money that isn&#x27;t hedged correctly. In which case, leverage is a barrier to entry that diminishes the number of participants in a market and reinforces cartel behavior. Which I would think is a bad thing.