Forex Education




Per unit of goods UnitA minimum can be traded by the commodity. Is called "Lot" LotDealing institutions that work with the system marginal things can be traded in fixed units of each unit is called Lott lot.In our example above the product is the car and one unit of which is the one car, which is the minimum you can trade it.You can not trade half a car .. But you can trade in multiples of this unit you can trade any car or three, etc. ..In our example above croaker = one car.There are institutions that allow you to trade textured soy Soy beans and less by the end of the trading is 5000 bushels Bushel - a unit of weight - that is meager here = 5000 bushels
 
. And there are institutions that allow you to trade in gold and is less an end to trading is 560 ounce croaker that is here = 560 ounces.You can trade Plaut, two or three and Bamadaafath, and you can not be traded or half lot of Plaut and a half.Contract Size Contract SizeIs the actual value of the commodity that allows you to trade by the institution.In our example above the product is a car and the actual value = $ 10,000When you buy 1 lot of requests from the agency means that you are required to purchase one car worth $ 10,000 and buy 2 at the request of the meaning of that lot that you are requesting to buy two cars worth $ 20,000 (2 * 10.000), and so on ..Contract size varies from one institution to another, one of the basic information Starafha before dealing with the institution that will open the way for trading on margin.
 
Double Leverage
 
Which is the ratio between the value of the item that you want to trade in and between the value of the bond which asks you to pay (used margin) to allow you to trade in this commodity.The multiplier can be calculated by the following formula:= Multiplier * number of contracts per contract size / margin usedIf we assume that the agency allow you to trade cars car and one (1 lot) worth $ 10,000 in exchange for your account is deducted from the amount of $ 1000 for each lot of margin user .. You can calculate the ratio of double:= Multiplier * number of contracts per contract size / margin used
          
= 1 * $ 10,000 / $ 1,000 = 10Which can be expressed as a 1:10 for every $ 1 you pay margin user will be doubled to ten times, ie, for every $ 1000 paid by the user as a margin you can trade in a commodity valued at $ 10,000Q: I assume that there is a car agency allows you to trade four cars, each worth $ 10,000 for every $ 1000 paid by the user how much margin percentage multiplier provided by this agency?Answer: double = the number of contracts * Contract Size / Margin user
                     
= 4 * $ 10,000 / $ 1,000 = 40Can be expressed as 40:1 it means that for every $ 1000 is deducted margin user you can trade a commodity worth $ 40,000, equivalent to 4 cars at once.And the percentage multiplier that could give you vary from one institution to another, one of the basic information before handling system Starafha marginal.
 
Used Margin Used MarginWhich is the amount that is deducted from your account temporarily refundable deposit for the product that you choose to be traded, this amount represents a small percentage of the value of the item Foundation Bhdzh temporarily until the completion of the transaction .. And you return the person to your account after the completion of the transaction and regardless of the outcome of the deal, both ended in profit or loss.Margin is calculated depending on the user to the following equation:Used Margin = the number of contracts * The contract value / percentage of doubleYou just need to learn the value of the contract with the organization that deals with them and that gives you double the proportion of them to be able to easily know the amount that the company temporarily St_khasmh margin of your user.In our example the size of the contract = $ 10,000 and the percentage multiplier is 10 times that you know how much the agency will be deducted from your account if you choose to buy 1 lot of any one vehicle:Used Margin = the number of contracts * The contract value / percentage of double
                  
= 1 * $ 10,000 / 10 = $ 1,000 will be deducted for each lotHad I thought to buy any 3 cars, 3 lots, the margin of the user who will be deducted from your account:Used Margin = 3 * $ 10,000 / 1000 = $ 3,000, $ 3,000 will be deducted from your account as margin user when you buy 3 cars (3 lot).Question 1: If we assume that the size of the contract with the institution = $ 20,000 and the proportion given multiplier = 20 times a 20:1 margin, how will the user who St_khasmh this institution if you buy 2 lots?Answer: Used Margin = the number of contracts * contract size / percentage of double
                            
= 2 * $ 20,000 / 20 = $ 2,000 will be deducted as a margin user.Question 2: Previous on the same hypothesis, how would you think if you used margin to buy Lot 4 of this institution?Answer: used margin = 4 * 20.000 / 20 = $ 4,000 will be deducted as a margin user.
 
Usable Margin MarginWhich is the amount remaining in your account after deducting the margin used it, which is the maximum amount allowed you to defeat the deal.The main purpose of the margin available is that the discount is, in case of loss, if lost in the car your trading amount of $ 500 will be deducted from your account to complete the full value of the car as explained above.It is important to know that the organization that deals through which the margin can not allow you to lose in the deal more than the available margin in your account.When you choose a commodity trading margin used will be deducted from your first .. Will come out of this amount from the account of the deal and if he does not exist, but in all cases will return to your account after you have finished selling the product.After you have cut the margin user would remain available margin in your account, and which was conveyed by the following equation:Margin = Equity - Margin userAs you monitor the price of the commodity that you have in the market, the organization that deals with it will monitor the price as well, as long as the price of current greater than the purchase price it so that if it decided to sell them immediately would be a winner, you will not interfere with the institution and will leave you the freedom to choose the right price for the sale, but that fell the current price of the purchase price for it so if you decide to sell at this price will be the loser will not interfere with the institution as long as you have it in the margin available to compensate for this loss.But as soon as the difference between the current price of the commodity and the purchase price equal to the margin of her available, will tell you that the deal to end or add more money to your account at the institution until the opponent, in case the price continues to fall.If you do not behave yourself, did not end the transaction and did not add more money to your account, the institution itself will sell the item at the current price without waiting for you to be, fearing that without the largest price drops to be in your account to compensate for the loss.So Valhamc is available which gives you the possibility to take the loss and wait until conditions improve.From here you will learn the extent that the margin available to you more as may be best for you.Let us take an example: Suppose that the agency allow the car to trade in a car, at least one value of each car $ 10,000 and the percentage of double 10 timesSuppose you opened an account with this institution the amount of $ 3,000, we will see what will happen if I thought about trading in one car and what will happen if I thought about trading car:Trading in one car:If I thought a car to trade one (1 lot) so I bought one car from the institution on a margin, the margin will be used:Used Margin = the number of contracts * contract size / percentage of double
                  
= 1 * $ 10,000 / 10 = $ 1,000 will be deducted $ 1000 from your account temporarilyAvailable margin in your account balance = - used margin
                           
= 3000 $ --1,000 $ = $ 2000 this amount will remain in your account as margin available, you know that this amount is the maximum amount that can allow you to defeat.If we assume that you went to the market and found that the price of the car became = $ 12,000This means that if you sold the car at this price you will pay the full value of the car and remain of the sale value of $ 2000 will be added to the gain you your account (12,000 -10.000)Greed may have to wait a further increase ..But suppose that the price of cars dropped to $ 9000 for the car, meaning that if you had decided to sell the car at this price will lose $ 1,000 will be deducted from your account at the institution.Suppose that you waitedBut the price fell more to $ 8,000 for the car, meaning that if it decided to sell at this price will lose 2000 $ (8000-10.000 = -2000) and this amount will be deducted from your account at the institution.Here you will not allow the institution to wait for more, and you will be required to sell the car at this price and if you want to wait you should add more money to your account to be able to rival you in case the price falls further.Thus the view that the available margin, which was to have given you the ability to be patient until the price to $ 8000 per car, where you at this moment able to compensate the difference in the loss of your account.
 
In the case of trading in two cars:Suppose you from the start I decided to trade in two cars together, what will happen?The margin of the user who will be his opponent is:Used Margin = the number of contracts * contract size / percentage of double
                 
= 2 * 10.000 / 10 = $ 2,000 of this amount will be deducted from your account at the institution as a margin user.Margin = Equity - Margin user
              
= 3000 - 2000 = $ 1000 is the available margin, which is the maximum amount you can lose in this deal.Suppose you went to the market and found that the price of the car was $ 12,000 for the car which if you sold the cars at this price you will pay the value of complete and $ 20,000 (2 * 10.000) and will remain in your account the amount of $ 4000 Sathsal by the gain to you ($ 24,000 eighth cars at market priceCurrent - $ 20,000 eighth cars claimed the institution).Undoubtedly, the biggest profit in trading profit in the car trade one car.Suppose you hope, I waited a further increase.But the price has dropped $ 9500 per car.