Profit/loss Calculation With Sigma Forex

what is a Pip (or point)?

The
term used in the currency market to represent the smallest incrementalmove an exchange rate can make. Depending on context, normally onebasis point (0.0001 in the case of EUR/USD, GBP/USD, USD/CHF and 0.01 in the case of USD/JPY).

How do I Calculate Profit/Loss?

The equation for EUR/USD, GBP/USD, and AUD/USD is as follows:P/L = (Opening Rate - Closing Rate) x Lot Size x Number of Lots

The equation for USD/JPY, USD/CHF and USD/CAD is as follows:P/L = (Opening Rate - Closing Rate) / closing Rate x Lot Size x Number of Lots

For a standard account, 1 pip results in a $10 profit/loss in EUR/USD and GBP/USD, approximately $9 in USD/JPY, and $8 in USD/CHF.

For a mini account, 1 pip result in a $1 profit/loss in EUR/USD and GBP/USD, approximately $0.9 in USD/JPY, $0.8 in USD/CHF.

Example

The current bid/ask price for USD/CHF is 1.5455/1.5458, meaning you can buy $1 US for 1.5458 Swiss Francs or sell $1 US for 1.5455.

Suppose you decide that the US Dollar (USD) is undervalued against the Swiss Franc (CHF). To execute this strategy, you would buy Dollars (simultaneously selling Francs), and then wait for the exchange rate to rise.

So
you make the trade: purchasing US$100,000 and selling 154,550 Francs.(Remember, at 1% margin, your initial margin deposit would be $1,000.)

As you expected, USD/CHF
rises to 1.5568/15571. You can now sell $1 US for 1.5568 Francs or buy$1 US for 1.5571 Francs. Since you bought Dollars and sold Francs inyour previous trade, you must now sell Dollars for Francs to realizeany profit. If you sell US$100,000 at the current USD/CHF rate of 1.5568, you will receive 155,680 CHF.

Since you originally sold (paid) 154,550 CHF, your profit is 1130 CHF. To calculate Dollar-based P&L, simply divide 1130 by the current USD/CHF rate of 1.5568.

Total profit = US $725.85

If you had done the opposite to initiate the trade (sold Dollars and bought Francs) you would have lost the same amount of money.

Lexus Prices Due to Increase

Lexus' prices will increase across its entire range from January 2009.

Lexus RRP Effective January 1 2009

Global economic pressure has forced Lexus to revise pricing across its model range. Soaring raw material costs on the commodity market linked with a weakening exchange rate were the main contributing factors.
Lexus New Zealand Manager Ms Debbie Pattullo said, "Lexus New Zealand has been trying to hold prices for as long as possible but with the New Zealand dollar being down approximately 25 per cent against the Yen when compared to the average rate over the past year, we have been left with no choice but to increase our prices."

She said the adjustments would be effective from January 1 2009.

Citigroup, UBS To Buyback $30 Billion Worth Securities From Thousands Of Investors

Washington, D.C. - The Securities and Exchange Commission has finalized settlements with Citigroup Global Markets, Inc. (Citi) and UBS Securities LLC and UBS Financial Services, Inc. (UBS), who misled investors regarding the liquidity risks associated with auction-rate securities (ARS) that they underwrote, marketed and sold.The Securities and Exchange Commission (SEC) said two companies will provide nearly $30 billion to tens of thousands of customers who invested in auction rate securities before the market for those securities froze in February.The settlements, which are subject to court approval, will restore... Click Here For More Details.

Make Money From Trading Currency

Many people are now looking at foreign exchange market as a favorable way to make money by trading currency. Recently a trading contest was held for members with live accounts in foreign exchange. The results showed that the first three winners of the contest had twice increased their investments in a month’s times. Some other contestants had also had very good returns. But this is not the case for every one. In fact only 30% of people trading in Forex actually make profits. The rest 70% lose a lot of money doing trading. If you are trading in Forex, there are 50% chances of either losing or profiting. This is because for every exchange of currency, one person lose and the other profits.
A simpleton might assume that those making profits have inside knowledge of where to make the best profits or they somehow manage to manipulate the market to suit their needs. But this is far from truth. Like mentioned earlier, the foreign exchange, market is the biggest trading market in the world. Hence, unlike the futures or the equities market, it is not an easy task to manipulate it. Governments of countries like the USA, the UK and Japan have tried to get the market in their favor, but they haven’t met with any success. It is difficult to get the market to suit your needs because all the traders have access to the all the market information at the same time.
So how do the 30% of traders manage to make profit when the majority seems to be losing? The simple answer is that these traders have good money management skills. They are well aware of the ups and down of the market. Their trading strategies, though a secret, are the best in the industry. Along with that they also know that the currency market is about making and losing money. Since they have recognized the risks of the trade, they are better able to cope with their losses, in case.

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