The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. For instance, gross profit is quickly calculated for the following trade involving the EUR/USD:Īny opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The Profit Calculator accomplishes this task automatically after the user provides all necessary inputs. It is critical that active traders understand the profit potential and assumed liability of every new position opened in the live market. Closing Trade Price: The price point at which the open position was closed out and market exit was achieved.Opening Trade Price: The price point at which a new position was opened and market entry was obtained.Standard, mini and micro lot sizes are some of the most common allotments used in the Profit Calculator. Trade Size: In order to determine the per pip value of each trade, the applied leverage must be defined.Action: A simple designation of whether the position is long or short, opened via buy or sell command.Account Currency: The preferred currency of the trading account.Currency Pair: A wide range of pairs are available, including the majors, minors, crosses and exotics.Maintenance - For every dollar the stock increases, in this example, the client would have to put up an additional $1.30/share in margin.Here is a breakdown of the inputs necessary to the robust functionality of the Profit Calculator: This excess margin could be used for additional trading. The market value of the stock decreases to $5. The account would need a deposit of cash or margin-eligible securities by close of business the same day. The total margin requirement of the short position is: Original short: 500 shares x 10.00 The market value of the stock increases to $20. The total margin requirement to hold the position includes 100% of the proceeds of the short sell and is calculated as follows:ĥ00 share x 10.00 x 130% = $6,500. The margin requirement to accept the trade is calculated the same as if you were purchasing the stock: 500 shares x $10.00 x 30% = $1,500. Short sell 500 shares of a 30% marginable stock priced at $10.00. Maintenance - For every dollar the stock decreases, in this example the client would have to put up an additional $0.50/share in margin. The account requires a deposit of cash or margin-eligible securities by close of business that same day. Less: Revised loan value 1,000 x $40 x 50% Since the loan balance is $25,000 the account now has a margin requirement of $5,000 which must be immediately resolved. The market value of the stock decreases to $40 Less: Revised loan value 1,000 x $60 x 50% Since the loan balance is $25,000 the account now has excess margin of $5,000 which gives the account holder additional purchasing power. The maximum loan value is now: 1,000 shares x $60 x 50% = $30,000 The market value of the stock increases to $60. Maximum loan value is -1,000 shares x $50 x 50% = $25,000 Scenario one Since 50% is the margin requirement, TD Direct Investing is lending the account holder 50% of the trade value. This amount must be in the account before a purchase order is placed. The margin requirement would be -ġ,000 share x $50 x 50% margin rate = $25,000 Purchase 1,000 shares of a stock with margin rate of 50% at $50.
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