Forex FAQ - Forex Trading

What is a pip?
What are the spreads on your platform?
What is going ‘long’ or ‘short’?
What is Leverage?
How do I select a currency pair?
How can I open a Trade?


What is a pip?

A Percentage in Point (pip) = 0.0001 (or 0.01 in Japanese Yen) is the smallest measure of price move used in Forex trading.

To calculate the value of one pip in a position you multiply the position size times 0.0001 (a pip) and you get the value of the pip in the term (second) currency. Then you can convert that value to your base currency.

Example:

100,000 AUDUSD position.

100,000 * 0.0001 = 10 USD

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What are the spreads on your platform?

As we have multiple accounts for a range of traders the spreads are tailored to specific users. Our spreads are fixed and we do not charge anything apart from the spread, in saying this we offer very competitive rates for all levels of clients. Click here to check out the spreads for different accounts.

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What is going ‘long’ or ‘short’?

Going long or opening a long position is when you Buy a currency with the expectation that the asset will rise in value. To go `short` is to have sold a currency with the expectation that the price will decline so it can be bought back in the future at a profit.

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What is Leverage?

Also called margin. The ratio of the amount used in a transaction to the required security deposit. The higher the leverage the less margin required to invest.

Example:

1:50 leverage is the same as investing 2% of the contract value.

1:400 leverage is the same as investing 0.25% of the contract value.

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How do I select a currency pair?

There are 3 easy ways to select the currencies you want to trade.

  • In the Trade window select the two currencies you want to trade from the drop down lists.
  • In the Quotes window find the currency pairs you want to trade and then double-click it to update the Trade window. You can also click and drag the currency pair to the Trade window.
  • In the Quotes window click on Display in the options at the top, select Large. This view enables you to open trades directly from the Quotes window.
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How can I open a Trade?

There are 2 ways to open a trade. You can either enter a Market Order or an Entry Order.

  • A Market Order is a trade that will be opened immediately at the rate you select by clicking Buy or Sell.
  • An Entry Order is a trade that you choose to open at a rate in the future. You enter your details the same as you would for a Market Order but instead of opening the trade now you enter the rate you want it to open at in the future. An Entry Order can stay in our system for up to 1 year, if the market doesn’t reach the rate then it will be cancelled at the expiry date.
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