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DislikedI've gone over his numbers, and I think he's drunk on maple syrup again (inside joke).
fxterrapin,
Please tell me my last PMs were wrong, otherwise you might have me calling into question the whole mantra of 'German engineering'.Ignored
DislikedSo let me get this straight: you sold EUR's and bought USD. Short from 1.48 something and closed out at 1.28 something and you have no P/L in your account?
How do you think funding in two different currencies affected this trade?
Most importantly what the F did IB tell you? Lets start there...Ignored
DislikedThis is a good way to describe it: The P/L basically shows the gain I made by not holding EUR (past the entry price). It's not a P/L that you can book by closing out the trade and buying back the currency that you sold (EUR in this case).Ignored
Disliked.....we haven't even delved into the issues of managed accounts or currency cross margins (those are entirely different stories altogether....Ignored
DislikedI then took a short position on the EUR/USD at 1.4680 and just closed it out at 1.2880.
http://i37.tinypic.com/2edrzah.jpgIgnored
DislikedBK,
Hav eyou heard of IB? We are not talking about some Muslim broker. I noticed in your example you forgot to talk about interest which would play a big part on PnL with a short EUR postion. Also, converting PnL into a base currency can affect pip values so there is a lot to go over. That's why I want to hear what IB has to say.Ignored
DislikedPIP value is the sole number where all others follow.
It is the absolute ruler.
ie, If you made 100 pips, it is 100 pips regardless of currency pair you traded.
However, when converting to actual currency (ie, USD, EUR, JPY) in which your account is funded, the rule of thumb is:
Pip value * Value of the Currency on the Right size of the currency pair.
Example:
10 Pips profit on EURUSD = 10 pips * USD1.00 * number of Mini Lots
10 pips profit on USDJPY = 10 pips * JPY100.00 * number of Mini lots; if you want to convert this to USD, then multiple it by the inverse of USDJPY.
Why did we use USD1.00 on the 1st example while we use JPY100 on the second?
Because, each pip value on xxxUSD pairs is 1/10000 while each pip in xxxJPY is in 1/100 or 100 times move than xxxUSDs. This is why we multiple it with JPY100 (and not by JPY1.00).
Sold EURUSD @ 1.4680 and close it @ 1.2880 is a solid 1800 pips profit. This 1800 pips profit WILL NOT change regardless of how many lots in this position or how many days it was opened.
Some brokers charges swap by changing/Adjusting your open price (such as Saxo) but the bottom line is (to avoid confusion), just count the $$$ PnL.
BTW fxterrapin. I assume that your account was opened in EUR as it was initially funded in EUR and this was traded with 1:1 Leverage???
LOL! You made money shorting EUR, but lost just as much because your account is in EUR!
1 Step Forward, 1 Step Backward
If this is indeed that case, you should have physically sold your EUR and bought USD and deposited just the same onto a bank. No Negative Swap no commission no dumb broker hassle.Ignored
DislikedThat's the entire point. I DID convert it physically. That was the trade.Ignored
DislikedSo, in the end, you did not make any money and instead paid the broker for the swap and commissions as against depositing the same money into a bank (much safer than with a broker) and earned interest safely.
1:1 leverage suck!Ignored
DislikedSo, in the end, you did not make any money and instead paid the broker for the swap and commissions as against depositing the same money into a bank (much safer than with a broker) and earned interest safely.
1:1 leverage suck!Ignored