Hello casv.

Great explanations from your side and I appreciate the efforts you have put in your post. You have explained every concept in simple words. Leverage is definitely beneficial if we properly use it with strategy and by doing proper analysis as It also have risk.

the risk of potential losses increases the greater the leverage,

True, the greater the leverage, higher the risk. If we use high leverage, then We can incur huge loss even with small price movement against our direction.

Best of luck for the contest.