Admin.
I opened a Gainscope account with a $20 dollar leverage of 1:400, how to calculate its resilience if we play with 0.01 lot? How to also calculate pips and margin?
@ Eko Purwanto:
- ... How do you calculate pip and margin?
If you are trading on the XXX/USD pair (EUR/USD, GBP/USD, AUD/USD, NZD/USD), then the contract value for 0.01 lot is USD 1,000, and the value per pip = USD 0.1.
In this case, the calculation for Margin is:
Margin = (USD 100,000) x (number of lots or volume) x 0.25% x current market price.
Description: USD 100,000 is the standard contract value for forex, and 0.25% is the margin percentage for 1:400 leverage.
For example: You buy or sell 0.01 lot of EUR/USD at a price of 1.1250, then the margin = (USD 100,000) x 0.01 x 0.25% x 1.1250 = USD 2.8
- ... how to calculate endurance if we play in 0.01 lot?
Capital endurance means the ability of your funds to withstand all open positions that are experiencing losses (floating loss) before you get a Margin Call (MC). Your goal in knowing capital endurance is to determine the amount of risk according to your capital. Capital endurance is measured in pips.
In the example above, the funds to withstand the position until a Margin Call is received are: (USD 20 - USD 2.8) / USD 0.1 = 172 pips.
Note: in the above example, it is assumed that your broker sets a margin level = 100% to issue a margin call, and does not charge swap when your position is overnight (swap free).