How to calculate the profit and loss of foreign exchange platform?
The basic principle of trade win loss calculation. The following example will show you the process of profit and loss calculation:
Suppose the current quotation of EUR / USD is 1.4616/19, which means that you can buy 1 euro with 1.4619 US dollars, or sell 1 euro and buy 1.4616 US dollars at the same time.
Suppose you predict that the euro will appreciate against the dollar, so you are willing to buy EUR (and sell USD) and wait for the exchange rate to rise.
So you buy 100000 euros (100000x1.4619) for us $146190. With 100:1 margin leverage, your margin account needs to be $1461.
As you expected, EUR / USD rose to 1.4623/26. To make a profit, you sell 100000 euros at 1.4623 and get 146230 dollars at the same time.
You bought 100000 euros for $146190 and now sell 100000 euros for $146230. The difference between them is four points, which is $40 ($146190-146230 = $40).
Total profit: $40
In the same example, suppose you still buy 100000 euros with us $146190 when the EUR / USD quotation is 1.4616/19.
However, this time EUR / USD fell to 1.4611/14. To reduce the loss, you choose to sell at this price, that is, sell 100000 euros and exchange it back to $146110.
You used to buy 100000 euros with 146190 dollars, and now you sell 100000 euros and exchange it back to 146110 dollars. The difference is 8 points, namely $80 ($146190 - $146110 = $80).