# Profit/Loss Calculator

#### What is a profit and loss calculator?

A profit-and-loss calculator helps traders calculate whether a trading position will potentially result in profits or losses. This, in turn, helps traders to determine where it is to best to set stop-loss and take-profit.

#### How does our profit and loss calculator work?

To calculate the potential profit or loss of a trading position, the calculator will take into consideration trading instrument, deposit currency, trade size, and the opening and closing price of the trade, and then, based on whether of the position type: buy or sell, the calculator will calculate accordingly.

## The calculation formula

Formula for lots:

Long = (Number of Lots * Notional Value of Lot) * (Close Price – Open price) * Account Currency Exchange Rate
(Only if the account currency is different from the denominated currency of the product)

Short = (Units * Price of product) / Leverage Factor] *Account currency exchange rate

Formula for Cash/Units:

Long = Units * (Close Price – Open price) * Account Currency Exchange Rate
(Only if the account currency is different from the denominated currency of the product)

Short = Units * (Open Price – Close price) * Account Currency Exchange Rate ## How to use the calculator

To calculate potential profits or losses of a trading position, specify certain trade parameters (e.g., the currency pair, deposit currency, and trade size), the opening and closing price of your trade, and whether you buy or sell.

Example 1:

Account base currency: AUD
Open price: 0.95666
Closed price: 0.96543
AUDCHF rate: 0.6327

Calculations:

(3.5 * 100,000 USD)*(0.96543 CHF per USD-0.95666 CHF per USD) = 3069.5 CHF.
Prices at time of calculation

Converting to account currency:

3069.5 CHF / 0.63276 CHF per AUD = 4850 AUD
Prices at time of calculation

Example 2:

Position: Sell
Account base currency: USD
Open price: 1800.56
Closed price: 1891.65

Calculations:

50*(1800.56 USD-1891.65 USD) = -4555 USD.
Prices at time of calculation

Account currency matches profit/loss denomination.