FAQ Main Categories

The foreign exchange market is a global decentralized or over-the-counter market for the trading of currencies.

 

The forex market is open 24 hours a day in different parts of the world, from 5 p.m. EST on Sunday until 4 p.m. EST on Friday. The ability of the forex to trade over a 24-hour period is due in part to different international time zones.

 Bid–Ask Spread is typically the difference between ask (offer/sell) price and bid (purchase/buy) price of a security. Ask price is the value point at which the seller is ready to sell and bid price is the point at which a buyer is ready to buy.

 

A sell trailing stop order sets the stop price at a fixed amount below the market price with an attached “trailing” amount. As the market price rises, the stop price rises by the trail amount, but if the stock price falls, the stop loss price doesn’t change, and a market order is submitted when the stop price is hit.

A stop out level in Forex is a specific point at which all of a trader’s active positions in the foreign exchange market are closed automatically by their broker, because of a decrease in their margin levels, meaning that they can no longer support the open positions.

Margin Call is a notification which lets you know that you need to deposit more money in your trading account, or close losing positions, in order to free up more margin. Put in another way, Margin Calls warn traders that the Stop Out level is approaching.

A pip measures the amount of change in the exchange rate for a currency pair, and is calculated using last decimal point. Since most major currency pairs are priced to 4 decimal places, the smallest change is that of the last decimal point which is equivalent to 1/100 of 1%, or one basis point.

Leverage is the use of borrowed funds to increase one’s trading position beyond what would be available from their cash balance alone. Forex traders often use leverage to profit from relatively small price changes in currency pairs. Leverage, however, can amplify both profits as well as losses.

EUR / USD 1.1800

The value of a pip = 0.0001 / 1.1800 = 0.0000847457627 Euro

This is the value of one pip per lot:

Standard lot size = 0000847457627 multiplied by 100000 = 847457627 ≈ 8.474 Euros

Mini lot size = 0000847457627 Multiplied by 10000 = 0.847457627≈ 0.847 Euro

Micro lot size = 0000847457627 Multiply by 100 = 0.0847457627≈ 0.084 Euro

And this is the value of a pip in US dollars:

    Standard lot (US dollars) = 8.474 euros multiplied by 1.1800 = $ 9.99932

    Mini lot (US dollars) = 0.847 Euros multiplied by 1.1800 = $ 0.999

    Micro lot (US Dollar) = 0.084 Euro Multiplied by 1.1800 = $ 0.099

 

In forex trading, the Spread is the difference between the bid (sell) price and the ask (buy) price of a currency pair. The pairing tells you how much of the variable currency equals one unit of the base currency.

• It’s a 24-Hour Market for Five Days. The forex market is worldwide, so trading is pretty much continuous as long as there’s a market open somewhere in the world.
• There’s High Liquidity. …
• Transaction Costs Are Low. …
• You Can Use Leverage. …
• There’s Profit Potential from Rising and Falling Prices.

Forex scalping is a short-term trading strategy that attempts to make a profit out of small price movements within the forex market. Scalpers​ ​will buy and sell a foreign currency pair, only holding the position for a period of a few seconds or minutes.

Days*(0.0001pip*Swap value) * Lot size

The Bitcoin Network is the first successful implementation of blockchain technology.

The term “blockchain technology” typically refers to the transparent, trustless, publicly accessible ledger that allows us to securely transfer the ownership of units of value using public key encryption and proof of work methods.

Bitcoin’s existence began with an academic paper written in 2008 by a developer under the name of Satoshi Nakamoto.
The paper described the foundation for what was intended to be a peer-to-peer electronic cash system that was secure, affordable, and efficient far beyond conventional banking standards. The system Satoshi described was developed into open-source software and the first bitcoin transaction (also known as the Genesis Block) was confirmed on January 3, 2009.

Ethereum is a distributed public blockchain network that focuses on running the programming code of any decentralized application. More simply, it is a platform for sharing information across the globe that cannot be manipulated or changed.

Bitcoin was a pioneer in the blockchain revolution by establishing a public, permissionless, distributed ledger system to validate, store, and replicate transaction data on computers all over the world. Ethereum expands these concepts by harnessing that same block chain capability for computer code. While Bitcoin offers one particular application of block chain technology, a peer-to-peer electronic cash system, Ethereum allows for scripts of code to be run as a global computational network. This concept has a wide range of potential applications such as voting, global supply chains, medical records, the financial system — the opportunities are endless.

Ether is a decentralized digital currency, also known as ETH. In addition to being a tradeable cryptocurrency, ether powers the Ethereum network by paying for transaction fees and computational services. Ether is paving the way for a more intelligent financial platform.

• A gas unit is the smallest type of work that is processed on the Ethereum network.
• Validating and confirming transactions on the Ethereum blockchain requires a certain amount of gas, depending on the size and type of each transaction.
• Gas measures the amount of work miners need to do in order to include transactions in a block.

One of the beautiful things about Bitcoin is that it is decentralized. This means it cannot be censored or controlled or manipulated by any single governing or centralized party, and all transactions are mathematically verified by a network of thousands of computers.

Bitcoin as a protocol itself cannot be hacked (well, theoretically it’s possible but it would take 100 yrs+ to achieve) and can not be controlled or manipulated by any single-point-of-failure. If you own Bitcoin, you are your own bank, and it is your responsibility to keep your coins safe.

Bitcoins are created through a process called mining. Supercomputers in the network called mining nodes are competing to solve an incredibly complex mathematical equation. The equation is so difficult to achieve, the ‘logical’ way of solving it is through guessing hundreds of different numbers (or nonces) a second. Unable to solve the equation in any other way, it takes approximately 10 minutes for the network of over 1 million computers to guess the correct answer. The miner who guesses the correct answer is rewarded in Bitcoin.

Some people trust Bitcoin for it’s decentralized, open-source transparency of financial transactions. Some find the immutability of transactional information appealing.
Others favor the strength of the network of nodes mathematically verifying transactions, completely removing the element of trust or human error in transactions.

There are a LOT of advantages to Bitcoin, however, a popular few would be:
The blockchain technology that created Bitcoin – it’s decentralized, open-source, and transparent.
There is a capped amount of 21 million coins that can ever be mined, meaning Bitcoin can not be copied, double-spent or hyper-inflated.
With Bitcoin, you own your digital assets, in your wallet and it is solely your responsibility. Your money is the numbers on the blockchain, not an IOU shown as a balance from the bank.

With Trade Kit, you can trade Forex around the clock, 5 days a week:
From March to October: from 00:05 (GMT+3) on Monday to 23:54:59 (GMT+3) on Friday.
From October to March: from 01:05 (GMT+3) on Monday to 00:54:59 (GMT+3) on Saturday.
The Forex market is open 24 hours a day. Although there aren’t necessarily any trading sessions, like with stock exchanges, banks in different parts of the world have different trading hours. In the table below, you can see when Forex trading opens and closes at banks around the world. When trading, you should take these times into account, as markets opening and closing can have an impact on the level of trading activity. Times are listed in GMT (Greenwich Mean Time, the time we typically use on our site), EET (Eastern European Time, the time used on our servers and in our trading platforms).

Demo accounts are valid indefinitely. Accounts of this type will remain active as long as you log in on the trading platform at least once every 10 days, i.e. you connect or reconnect your account to the server at least once every 10 days. In this regard, opening and closing positions by accessing the server does not count.

To answer this question, we’ll first need to look at how the bars are formed in your trading platform:
The High (the top of the bar) is the maximum Bid price for a certain time period.
The Low (the bottom of the bar) is the minimum Bid price for the time period.
Since the Ask price is equal to the Bid price plus the spread, the minimum Ask price equals the Low plus the spread and the maximum Ask price equals the High plus the spread.
Stop Loss and Take Profit orders on Buy positions are triggered when the Bid price (in the stream of quotes) hits the order level.
Stop Loss and Take Profit orders on Sell positions are triggered when the Ask price reaches the order level.
Buy Limit and Buy Stop orders on a position are triggered when the Ask price reaches the order level.
Sell Limit and Sell Stop orders on a position are triggered when the Bid price reaches the order level.

Use one of the following formulas:

For Buy Positions: Profit/Loss = (Contract × ClosePrice) – (Contract × OpenPrice)
For Sell Positions: Profit/Loss = (Contract × OpenPrice) – (Contract × ClosePrice)
Profit/Loss the profits/losses on the position expressed in the quote currency
Contract: the size of the contract in the base currency
ClosePrice: the rate when the position is closed
OpenPrice: the rate when the position is opened
Example: Let’s calculate the USD profits/losses for a position on EURGBP.

The position:

Contract Size (in lots): 0.19 lots
Trading Instrument: EURGBP
EURGBP OpenPrice: 0.6983
EURGBP ClosePrice: 0.6883 (0.6983 – 0.6883 = 0.0100 = 100 pips)
Contract Size (in EUR): 19,000 EUR
GBPUSD Rate: 2.0256 (to convert the profits/losses from GBP to USD)
Calculation:

Profit/Loss = (19,000 × 0.6983) – (19,000 × 0.6883) = 13267.7 – 13077.7 = 190 GBP.
Now we’ll convert to USD: 190 GBP × 2.0256 = 384.86 USD.
So, the position earned 384.86 USD in profits.

You can calculate the profits/losses for positions on other currency pairs and on spot metals very much like in the example above.

Profits and losses on the SPX500 instrument are calculated as follows:

For Buy positions: Profit/Loss = (ClosePrice – OpenPrice) × Lots × 100;
For Sell positions: Profit/Loss = (OpenPrice – ClosePrice) × Lots × 100.
Profits and losses on the WassSt30 instrument are calculated as follows:
For Buy positions: Profit/Loss = (ClosePrice – OpenPrice) × Lots;
For Sell positions: Profit/Loss = (OpenPrice – ClosePrice) × Lots

In Forex, when you keep a position open through the end of the trading day, you will either be paid or charged interest on that position, depending on the underlying interest rates of the two currencies in the pair. In the examples below, we’ll show you how to calculate the amount that will be credited or charged, factoring in only the interest rates and the broker’s commission, but in reality, the “storage” for holding a position overnight may depend on a variety of factors:

The current interest rates in the two countries
The price movement of the currency pair
The behavior of the forward market
The swap points of the broker’s counterparty
Here’s what we mean when we say storage depends on interest rates:

Let’s say that the interest rate of the European Central Bank (ECB) is 4.25% and the Fed (US) interest rate is 3.5%. You open a short position (Sell) on EURUSD for 1 lot. Here, you are essentially selling 100,000 EUR, borrowing at a rate of 4.25%. In selling EURUSD, you are buying US Dollars, which earn interest at a rate of 3.5%. When the interest rate of the country whose currency you are buying is more than the interest rate of the country whose currency you are selling, storage will be added to your trading account (this may not always hold true, as brokers often charge a fee or markup for overnight swaps). If the interest rate is higher in the country whose currency you are selling, as is the case in this example (4.25 > 3.5), storage will be deducted from your account.

Now let’s say the broker charges an extra 0.25% for the swap. Add this to the 0.75% difference in the interest rates and you get 1.00%. For the position described above, the storage you will be charged will be equivalent to being charged 1.00% interest.

Calculating the swap on a short position: Here we are buying USD and selling EUR. Since the interest rate of the currency we are selling (EUR: 4.25%) is higher than that of the currency we are buying (USD: 3.5%), we will add the Markup in the formula:

SWAP = (Contract × (InterestRateDifferential + Markup) / 100) × Рrice / DaysPerYear

Contract: 100,000 EUR (1 lot)
Рrice: EURUSD – 1.3500
InterestRateDifferential: 0.75% (the difference between the interest rates in Europe and the US)
Markup: 0.25% (the broker’s commission)
DaysPerYear: 365 (number of days in a year)
Calculation:

SWAP = (100,000 × (0.75 + 0.25) / 100) × 1.3500 / 365 = 3.70 USD
When your short position on EURUSD is rolled over to the next day, 3.70 USD will be debited from your trading account for storage.

Calculating the swap on a long position: When we buy EURUSD, we are buying EUR and selling USD. Since the interest rate of the currency we are buying (EUR: 4.25%) is higher than that of the currency we are selling (USD: 3.5%), we will subtract the Markup in the formula:

SWAP = (Contract × (InterestRateDifferential – Markup) / 100) × Рrice / DaysPerYear

SWAP = (100,000 × (0.75 – 0.25) / 100) × 1.3500 / 365 = 1.85 USD
When your long position on EURUSD is rolled over to the next day, 1.85 USD will be credited to your trading account.

Please Note: When the difference between the interest rates is smaller than the broker’s commission, you will be charged storage for both Buy and Sell orders.

Calculating the swap for stock index CFDs: In our example, we will calculate the swap for keeping a short position open overnight on the ASX200 index.

SWAP = ((InterestRateDifferential / 100) / 360) × ClosePrice × Lots × Contract, where:

InterestRateDifferential — -3 (the swaps for short and long positions are shown separately in the contract specifications on our site)
ClosePrice — 5815.5 (the closing price of the order)
Lots — 10 (the order volume)
Contract — 0.5 (the size of 1 lot)
Calculation:

SWAP Short = -3 / 100 / 360 × 5815.5 × 0.5 × 10 = -2.42 AUD.

In the MetaTrader terminal, in the specifications for an SPX500 instrument, the swap values differ from those shown in the “Contract specifications” section on the website by a factor of 100x, since a separate calculation formula is used for this instrument. As a result, when data from the trading terminal is used to calculate the swap on the SPX 500 instrument, the following formula is used:

SWAP = Interest ÷ 100 ÷ 360 × ClosePrice × Lots × Contract × 100, where:

ClosePrice is the closing price of the order.
Lots refer to the volume of an open order.
Contract is the size of 1 lot.
Calculating the swap for commodity CFDs: In our example, we will calculate the swap for keeping a short position open overnight on the NG instrument.

SWAP = Swap in pips × Lots × PipValue, where:

Swap in pips – -0.260 (the swaps for short and long positions are shown separately in the contract specifications)
Lots — 10 (the order volume)
PipValue – 1 (the value of 1 pip in USD)
SWAP Short = (-0.260) × 1 × 10 = -2.60 USD.

The swap rate for metals can be calculated in the same way as for currency pairs.

You can find our swap points for different trading instruments in our Contract Specifications (Swap Short and Swap Long). Swap rates are subject to change. The swap rates in our “Contract Specifications” are updated daily at 21:00 EET. You can also calculate the swap charges for long and short positions with our “Trader’s Calculator”.

Please note that on the Forex market, when a position is held open overnight from Wednesday to Thursday, storage is tripled. This is because a swap involves pushing back the value date on the underlying futures contract. For a position opened on Wednesday, the value date is Friday. When a position is kept open overnight from Wednesday to Thursday, the value date will be moved forward 3 days, to Monday (skipping over the weekend). Storage is tripled because you are being paid or charged interest for 3 days instead of just one.

Triple storage is also charged for keeping positions on commodity CFDs open from Friday to Monday.