Menu
Home
Advertise
Forums
Search forums
What's new
Unread posts
Latest activity
Earn Money
Money apps
Passive Income
Paid Survey
Forex
Stock
Real estate
Paid to write
Social Media Monetization
Review Website/Apps
Crytocurrency
Bitcoin (BTC)
Ethereum (ETH)
Crypto Exchange
Mining
Crypto Faucet / Airdrops
Binance
Business
Business strategy
Funding a business
Marketing
Digital Marketing
Social media marketing
Email marketing
Brand management
Personal Finance
Money Saving
Retirement
Personal loan
Savings for Students
Debt help
Tax relief
Insurance
Car Insurance
Life Insurance
Liability Insurance
Home Insurance
Health Insurance
Disability Insurance
FAQ
Log in
Register
What's new
Search
Search
Search titles only
By:
Search forums
Menu
Log in
Register
Install the app
Install
Home
Forums
Money Making Forums
Make Money Online
Forex
RoboForex - roboforex.com: overview, news and analytics
JavaScript is disabled. For a better experience, please enable JavaScript in your browser before proceeding.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an
alternative browser
.
Reply to thread
Message
[QUOTE="RoboForex Team, post: 332265, member: 105160"] [B][SIZE=5]How to Calculate a Trading Lot in Forex Market?[/SIZE][/B] [CENTER][img]https://blog.roboforex.com/wp-content/uploads/2019/09/%D0%9A%D0%B0%D0%BA-%D1%80%D0%B0%D1%81%D1%81%D1%87%D0%B8%D1%82%D0%B0%D1%82%D1%8C-%D1%82%D0%BE%D1%80%D0%B3%D0%BE%D0%B2%D1%8B%D0%B9-%D0%BB%D0%BE%D1%82-%D0%BD%D0%B0-%D0%A4%D0%BE%D1%80%D0%B5%D0%BA%D1%81-%D0%B4%D0%BB%D1%8F-%D0%BE%D1%82%D0%BA%D1%80%D1%8B%D1%82%D0%B8%D1%8F-%D0%BE%D1%80%D0%B4%D0%B5%D1%80%D0%B0.png[/img] [B]Dear Clients and Partners,[/B][/CENTER] [SIZE=5]What is a trading lot?[/SIZE] Such thing as a “lot” plays important role in activity of any trader. In this article, we’ll discuss the term “trading lot” on Forex and describe the ways to calculate it. A lot is a volume of an operation on the Fore market, which is defined by global standards. 1 lot always equals to 100,000 units of a base currency. For example, in case of USD/CAD, 1 lot is 100,000 USD, because the base currency of this pair is the American Dollar. If one takes such instrument as EUR/USD, then one lot equals to 100,000 EUR or, translated at the current exchange rate, 137,000 USD (EUR/USD rate is 1.3700, hence 1 lot equals to 100 000 * 1.3700). To open a position of 1 lot worth 100,000 USD, one requires quite a lot of money on their account or the leverage, that’s why financial operations with such amounts of money are mostly performed by large funds and different financial institutions. As for retail speculators with relatively small deposits, brokerage companies provides them with an opportunity to trade fractional lots. [SIZE=5]How to calculate a lot on Forex?[/SIZE] When opening a position, a trader needs to calculate the optimal volume, i.e. the quantity in lots, which will allow the trader’s deposit to remain stable in case of any fluctuations against the open position. The order shouldn’t be closed by Stop Out even in case of the slightest price pullback. First of all, to calculate the volume of a position to be opened, one must decide on two major components: [LIST] [*]The amount of maximum permissible risk for one position to be opened. [*]Stop Loss level in pips from the entry point. [/LIST] In addition to that, the following factors are used for calculations: [LIST] [*]The deposit amount. [*]The cost of 1 pip of the price when using standard lots. [/LIST] There are several methods of calculating the optimal lot size on the Forex market, and we’ll review three of them. In our examples, we’re going to use the following parameters: [LIST] [*]Deposit is 2,000 USD. [*]Currency pair is GBP/USD (the cost of 1 pip in case of 1 lot order is 10 USD). [*]Maximum permissible risk for 1 transaction is 3%. [*]Stop Loss length is 100 pips (the distance between the entry point and Stop Loss level). [*]The leverage value is 1:100. [/LIST] All calculations are made for a trading account with the USD as its base currency. [SIZE=5]Recommendations for beginners[/SIZE] It is critical for beginners not to overstate the volume of transactions, even if you are 100% sure of the result. Below we will offer some useful tips that will help reduce the level of possible losses: [LIST] [*]During the calculation of the lot size, do not round the result up. Rounding should occur only to the smaller side. Example: when you got the value 0.728, with the correct rounding, your result will be 0.72. [*]Test the selected trading strategy on historical data, which helps to determine the optimal average Stop Loss order value. This simplifies the calculation, since you no longer have to substitute new values. Only the size of the deposit and the level of risk will change, the rest of the data is known. [*]When calculating Stop Loss levels, it is imperative to consider the size of the spread. If you place a stop order at 30, and the spread value is 2, then Stop Loss should be set at 32. [/LIST] [I]Read more at R Blog - RoboForex[/I] [B]Sincerely, The RoboForex Team[/B] [/QUOTE]
Insert quotes…
Verification
Post reply
Home
Forums
Money Making Forums
Make Money Online
Forex
RoboForex - roboforex.com: overview, news and analytics
Top