Due to margin trading, Forex allows you to trade currencies
even when your funds are limited.

Essentially, trading on margin means the following: when a trader trades on margin he uses a free of charge short-term loan from the institution that is offering this margin. This short-term loan allows the trader to purchase a certain amount of the currency, in which the total cost by far exceeds the amount of funds in the trader’s account. Loan amount is defined by lending rate known as leverage. Therefore, only a small amount of the trader’s real funds acts as collateral. Leverage value can range anywhere from 1:50 to 1:500 (traders choose the leverage themselves) – which allows the client to buy currency for the amount that exceeds the value of collateral by 500 times!
 

	Opening a Transaction

After market situation analysis, suppose you have made a prediction that the EURO exchange rate might increase in relation to the US dollar. Therefore you decide to buy EURUSD pair in the amount of 0.01 lot (trading leverage on the account is set at 1:200, deposit currency – RUB).

In order to open a Buy transaction EURUSD in the amount of 0.01 lot at the rate of 1.4697 you need 179.97 RUB of free funds on your account. . Trader’s Calculator can help you estimate the amount required for opening a new position.

To open a transaction, open a new order window by double-clicking on the desired currency pair in the "Market Watch" window of the trading platform, as shown on the picture or by pressing F9. In the new window, "Order", (see the picture below) select the desired currency pair and transaction volume. If necessary, you can also specify other parameters.

In order to open a transaction, press the corresponding key – Buy or Sell.



When opening a transaction you automatically receive credit for the amount, which is defined by the leverage set for your account. In this particular example, with 1:200 leverage for each 1 RUB of funds engaged for opening the position you get 200 RUB credit. Thus, using 179.97 RUB you buy 1001.33 EUR (for the amount of 35,994 RUB).

After opening the transaction, the sum used for its opening is transferred as collateral .



Balance – trading account balance.
Funds – balance with account of profit from open positions.
Collateral – cash reserved as pledge for maintaining open positions.
Free – free cash that can be used for opening new positions.
Level – current margin level.
 

	Profit Calculation

After some time, when the EURUSD rate reaches 1.4745, you decide to close the transaction.

At the opening, 1001.33 EUR were bought for the 179.97 RUB used for opening the transaction with the account of the leverage. At closing, this sum is sold for RUB at the current rate of 1.4745 which amounts to 36,111.28 RUB. The credit is automatically closed and the difference between the amount bought and the amount sold – 36111.28 - 35994 = 117.28 RUB – is your profit from the transaction.
 

	Closing a Transaction

To close a transaction in the "Terminal" window of the trading platform, double-click on the transaction you wish to close or click the right mouse button to open the context menu and select "Close."



When "Order" window appears, click "Close".




After closing the transaction, the amount used for its opening will be released from collateral .



 

Answers to the questions most frequently asked by our clients can be found in "FAQ."