CFD trading
Hello. The simplest way to calculate this task: US500 has a ask price of 4160 and a bid price of 4161. You open a long (buy) CFD trade of 20 contracts, equal to €20 per point. The price increases to ask price 4172 and bid price 4173. You close the trade. What is your profit (without fees)? Regards
Hello. The simplest way to calculate this task: US500 has a ask price of 4160 and a bid price of 4161. You open a long (buy) CFD trade of 20 contracts, equal to €20 per point. The price increases to ask price 4172 and bid price 4173. You close the trade. What is your profit (without fees)? Regards
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2 answers
To calculate the profit, we first need to calculate the difference between the opening price and the closing price of the trade:
Price difference = closing price - opening price Price difference = (4172 - 4161) = 11 points
Then we need to multiply the price difference by the contract value, which is €20 per point:
Profit = price difference x contract value x number of contracts Profit = 11 x €20 x 20 Profit = €4,400
So your profit (excluding fees) is €4400.
To calculate the profit, we first need to calculate the difference between the opening price and the closing price of the trade:
Price difference = closing price - opening price Price difference = (4172 - 4161) = 11 points
Then we need to multiply the price difference by the contract value, which is €20 per point:
Profit = price difference x contract value x number of contracts Profit = 11 x €20 x 20 Profit = €4,400
So your profit (excluding fees) is €4400.
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Contracts for Difference (CFDs, Contract for Difference) are a complex form of investing, thanks to which an investor can profit from changes in the price of financial instruments without having to own them. In CFD trading, the investor enters into an agreement with the broker/investor in which he undertakes to pay the difference between the opening and closing price of the trade. If the price of a financial instrument rises, the investor takes a profit, and if the price falls, the investor takes a loss. CFDs can be traded on various financial instruments, such as stocks, commodities, stock indices and currencies. It is worth remembering, however, that this type of investment is subject to high risk, and the level of financial leverage can cause quick capital losses. CFD investments can also be used to hedge a portfolio against asset depreciation. However, we recommend that before deciding to invest in CFDs, you should consult an experienced financial advisor and carefully study the information on the assets in which you invest.
Contracts for Difference (CFDs, Contract for Difference) are a complex form of investing, thanks to which an investor can profit from changes in the price of financial instruments without having to own them. In CFD trading, the investor enters into an agreement with the broker/investor in which he undertakes to pay the difference between the opening and closing price of the trade. If the price of a financial instrument rises, the investor takes a profit, and if the price falls, the investor takes a loss. CFDs can be traded on various financial instruments, such as stocks, commodities, stock indices and currencies. It is worth remembering, however, that this type of investment is subject to high risk, and the level of financial leverage can cause quick capital losses. CFD investments can also be used to hedge a portfolio against asset depreciation. However, we recommend that before deciding to invest in CFDs, you should consult an experienced financial advisor and carefully study the information on the assets in which you invest.
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