Forex Profit Calculator & Trading Calculator For Loss & Profit
Are you struggling to calculate forex profit or loss of trades? Here is a step-by-step guide to profit calculations with different lot sizes & criteria.
The ultimate aim of forex traders is to earn a good amount of profit from trading. Having a clear idea of expected profit or loss before opening a position is a must for traders. That’s where tools like a forex trading profit calculator, trading calculator, and investment calculator forex calculator come into play.
However, many traders struggle with profit calculations. Even experienced traders face the same situation, especially when dealing with forex position size calculator and forex lot size calculator. Calculating your lot size, pip value, and trade return can be tricky without the right tools.
Profit calculation is not that difficult in forex. However, the lot size and pip value make it complex. That’s why professional traders rely on an advanced trading calculator or a forex calculator to get accurate results. Whether you’re calculating loss & profit, estimating futures calculator results, or reviewing your forex trading profit, these tools can simplify everything.
In this article, we will study the forex trading calculator and find out how to calculate forex profit with ease using a variety of tools like the trading calculator, trade return calculator, and forex position size calculator.
Components of Forex Profit Calculator
The first step of profit calculations is to collect all the information that can make a difference to the profit amount. Here are the essential components of profit calculations:
Currency Pair: Identify the forex pair you want to trade in. Generally, a pair includes two currencies: base and quote. In the currency market, profit is generally calculated in quote currency.
Position Type: In the forex market, traders can make a profit from both buying or selling the pairs. So first, determine whether you are opening a short or long position.
Lot Size: Currencies are traded in lot sizes. Lot size can also be defined as the quantity of currency. There are three main types of currency lots: Standard, Micro, and Mini. The lot size is among the most important elements that can make profit calculation quite complex.
Entry and Exit Prices: These can be defined as the price at which you enter (open) and exit (closing) a trade position.
Exchange Rate: Exchange Rate can be defined as the rate at which traders buy or sell one currency against another. The exchange rate of a pair keeps fluctuating, impacting the profit or loss amount.
Leverage: Traders can place trades larger than their capital using a leverage facility. Leverage can significantly enhance your profit or loss amount.
How to Use the Forex Trading Profit Calculator
- The first thing you need to do to calculate forex profit is find a platform that provides a calculator. Many platform provides a forex calculator for free. You just need to search forex trading profit calculator on Google, and you will get the platform’s list.
- Select an ideal platform from the list. Generally, financial education sites and brokers offer these tools. So, go for a reputable platform.
- Enter information such as currency pair, type of position, lot, leverage, and other details.
- Once you have entered the information, click on calculate and the tool will give you the profit details.
Understanding Forex Profit Calculations with Lot Size
You have learned about the elements you need to calculate profit. Now let us practically understand forex profit calculation for different lot sizes with an example:
Standard or 1 lot size profit or loss calculation
Currency Pair: GBP/USD
Opening Price: 1.2500
Closing Price: 1.3100
Stop Loss: 1.2000
Position: Bullish
Profit = (Closing Price – Opening Price)* Lot size
The standard Lot size equals 100,000 units.
In the case of the trade close trade position at a profit, then the profit amount will be (1.3100-1.2500)* 100,000 = 6000 USD. And if the trader closes the trade at a loss then the loss will be (1.2000-1.2500)*100,000 = 5000 USD.
Mini or 0.1 lot size loss & profit calculation
The Mini Lot size equals 10,000 units. In the same example, If the trader closes the trade at a profit, the profit amount will be (1.3100-1.2500)* 10,000 = 600 USD. If the trader closes the trade at a loss, then the loss will be (1.2000-1.2500)*10,000 = 5000 USD.
Micro or 0.01 lot size profit or loss calculation
The above example is of long positions. Now, for a better understanding, let us understand profit and loss calculation with another example of the short position. Here are the criteria of trade:
Currency Pair: EUR/USD
Opening Price: 1.1500
Closing Price: 1.1100
Stop Loss: 1.1600
Profit = (Opening Price – Closing Price)* Lot size
Now, in this case, if the trade closes on profit, then the amount will be (1.1500 – 1.1100)*1000 = 40 USD. And suppose if the trade closes at a loss, then the amount will be (1.1500 – 1.1600)*1000 = 10 USD.
Forex Profit Calculation with Leverage
When leverage enters the trade, profit, and loss calculation becomes difficult for traders. So, let us understand how to calculate pip profit with leverage:
Currency Pair: XAU/USD
Lot Size: 1 (100 Ounce)
Entry Price: 2500
Exit Price: 2550
Leverage Ratio: 1: 100
Position: Buy
The trader has a capital of 5000 USD, so he decided to open a trade worth 2500 USD. By using 1:100 leverage, the trader can control a position of 1 lot.
So his profit will be (2550- 2500)*100 = 5000 USD. However, one thing to remember while trading with leverage is margin maintenance. A trader needs to maintain a margin amount while trading with leverage.
Like in the above case, he opens a trader worth 250000. Thus, he needs to maintain a margin of one percent or 2500 USD; otherwise, he will get a margin call, and the position will close automatically
Benefits of Using a Forex Trading Calculator
Saves your Time: Forex profit calculation requires your lot of your time, especially when you are using leverage and lot size. And for traders, every minute is crucial. Using a forex trading calculator will save you a lot of time, and that time you can use for market analysis.
Boost Accuracy: When manually calculating forex trading, the chances of human errors and calculation mistakes are there. However tool will not make such errors.
Enhanced Decision Making: Tracking your profit in advance will transform your decision-making. Traders can plan their trade entries and exits with ease.
Risk Management: The knowledge of expected profit will also help you in adjusting your risk. Traders can make changes in their risk management plan, risk per trade, or risk-to-reward ratio, tracking the forex profit.
Risk and Limitations of Forex Calculator
Data Oriented: The Forex trading calculator will show you the profit based on the information you have entered. Wrong information, wrong results.
Platform Dependency: Forex trading calculator are generally offered for free by your broker. However for using it you need to open an account with specific platform as the free version is available for the limited period.
Wrapping Up
We have understood how to calculate forex profit using different examples. Profit calculation is basic, and a beginner should know how to do it.
However, a range of forex profit calculators are available in the market for free. Traders just need to enter the information, and the tool will calculate their profit or loss from a trade.
But even when using a forex calculator, ensure the information you enter is accurate. Otherwise, even the tool will give you the wrong results.
Generally, beginners struggle with profit calculations in trading. So, if you are a newbie, open a demo account with us and master all the practical concepts of forex trading.
FAQ
1. How to calculate profit?
In the trading world, you can either calculate profit manually or by using forex trading calculator.
2. How to calculate daily forex profits and losses?
For daily calculating forex profits and losses use forex trading calculator.
3. How to calculate profit in forex trading using pips and lot size?
Use forex calculator with lot and pips options to calculate forex profit.
4. How to calculate pip difference for accurate forex profit estimations?
Use Pip calculator tool to for accurate estimation of forex profit estimations.
5. How does a profit calculator help in forex trading?
A forex calculator boost the speed, accuracy and helps you in making informed decisions.
6. What information do I need for accurate profit calculations?
Currency pair, lot size, pip target, position type, and the leverage are the information you need for forex profit calculator.
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