Trading online is a great way to make money. Some do it on the side while juggling a full-time career while others do it as their main job. Either way, it can be a tricky to forecast a company’s performance and earn some cash out of it. That’s why some people choose to get help so they minimize the potential risk.
If you search online you might find a website called alpari.com that acts a sort of guide when you navigate the world of finances and trading. There are others out there but how do you know which to trust and what are the signs you look for when getting the service of one agency vs another? It may seem hard but picking them is easier than you expect.
Forex, also known as foreign exchange, FX or currency trading, is a decentralized global market where the entire world’s currencies trade. The forex market is the largest, most liquid market in the world with an average daily trading volume exceeding $5 trillion. All the world’s combined stock markets don’t even come close to this. This is huge opportunity to however is up for it!
The trader’s Forex calculator
The trader’s calculator has been designed to allow you to work through the implications of a trade before it is opened, or to analyze an already open one. By using the Forex calculator, you can examine up to 5 trades simultaneously, looking at aspects such as pip value, contract size, spread, swap, margin, commission and potential profit.
Just enter the data that you want to consider and click “Calculate”.
How to use
Let’s say you have a standard.mt4 account with leverage set to 1:1000, and you want to work out the spread, swap and potential profit for a SELL position of 10 lots of USDJPY. Firstly, enter the appropriate details in the “Account Settings” section. You’ll need to select i) standard.mt4 ii) leverage at 1:1000 and iii) USD as the account currency. When you have done that, click “Accept and Continue” and the “Trade Settings” section will open up.
Choose USDJPY from the instrument list, then type in 10 in the “Volume” column, and choose SELL as the action. The calculator will then add the opening and closing prices of the deals, which you are free to edit as required.
Let’s say that the opening price is 100.500 while the closing price is 100.3501.
The following will be displayed in the table:
- Trading Instrument – USDJPY. More information about specific trading instruments can be found on the “Contract Specifications” page.
- Price – 100.500. This is the SELL price of the trade. If you want, the calculator will convert this amount into your deposit currency showing the exchange rate.
- Pip Value – 99.50 USD. For more information on how to calculate this value, see the “Trading Conditions” page.
- Spread (the difference between the Ask and Bid prices) – 19.90 USD. Each currency pair has an average spread.
- Swap (the cost of keeping a position open overnight). Depending upon the interest differential of the currencies you are trading, this figure can either be positive (in your favor) or negative. More details can be found in the “Trading Conditions” page. The calculator works out the current value of the swap by itself, taking information from the “Contract Specifications”2.
- Margin, or the minimum amount of free equity on your trading account required to open a specific position. The calculator looks at the Margin Requirements for each instrument.
- Profit. As the position was opened as a SELL, on the basis that the price would fall, the potential profit is 1,542.25 USD.
It can be complex at the start but you don’t need to make it any more difficult than it already is. Getting the right investment partner will give you plenty of advantages and opportunities in simplifying the world of finance. You don’t need to feel forced to do it all on your own. But, before you pick it’s still important to study your partner or the service from all angles. You’re putting your money into something potentially risky so you want to be sure as much as possible.