Foreign Exchange Currency Trading Examples

Please note the following assumptions:

  • On the MetaTrader 4 platform, 1 lot equals 100,000 of the first named currency.

  • Pip values are calculated in the second named currency, as exposure multiplied by smallest movement.

  • Profit is calculated by (sell price - buy price) x contract size.

  • The profit is converted to the account currency (AUD).

Example 1:

A client buys 1 lot of AUDUSD @ 0.7525.
The position is closed @ 0.7548.
Profit/loss is calculated as (0.7548 - 0.7525) x 100,000 = US$230.
The profit/loss is converted to the account currency by the following calculation: 230/0.7548 = $304.71.

Example 2:

A client sells 0.5 lots of EURGBP @ 0.8790.
The position is closed @ 0.8803.
Profit/loss is calculated as (0.8803 - 0.8790) x 50,000 = -GBP65.
The profit/loss is converted to the account currency by the following calculation: 65/0.4907 = -$132.46.

Example 3:

A client sells 0.5 lots of AUDJPY @ 0.7505.
The position is closed @ 0.7468.
Profit/Loss is calculated as (0.7505 – 0.7468) x 50,000 = JPY18,500.
The profit/loss is converted to the account currency by the following calculation: 18,500/74.68 = $247.72.