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Foreign exchange
The foreign exchange market is the largest financial market in the world, involving banks, companies, financial institutions and retail investors. The foreign exchange market is also the largest financial market in the world. The average daily trading volume of the global foreign exchange market is about US $5.1 trillion (according to the data provided by the bank for International Settlements in April 2016), which is growing rapidly year by year. With such a huge trading volume, no individual institution can completely control the market trend. It is the fairest and most transparent trading market in the world. Investors can buy and sell money in real time according to the rapid market changes, so it attracts a large number of investors to trade and invest in the foreign exchange market.
characteristic
It is one of the markets with the largest trading volume in the world 24 hours a day, 5 days a week. It has high liquidity, up to 100 times leveraged margin, improves capital utilization, can be held or traded, and can be traded under different market trends.
example
Examples of foreign exchange CFD transactions:
Example 1: buy a standard hand EURUSD differential contract (contract size 100000) to bullish the EURUSD exchange rate.
  • Transaction description
  • Profit / loss
  • Buy / long 1 standard hand EURUSD contract at a bid price of 1.13330
  • 1 x 100000 x 1.13330 = USD 113330 (contract value) (contract value in quoted price (RHS) currency)
  • The leverage ratio set by the account is 100:1, that is, the initial margin requirement is 1% of the contract value
  • USD 113330 x 0.01 = USD 1133.30 (initial margin) {sys: cpfname} the margin ratio set is USD 1000 / hand
  • Close 1 standard hand EURUSD contract (sell / short) at a selling price of 1.13830
  • (1.13830 - 1.13330) x 1 x 100000 = $500.00 profit
Example 2 - sell a standard hand EURUSD CFD contract (contract size 100000) to bearish the EURUSD exchange rate.
  • Transaction description
  • Profit / loss
  • Sell / short 1 standard hand EURUSD contract at a selling price of 1.13450
  • 1 x 100000 x 1.13450 = USD 113450 (contract value) (contract value in quoted price (RHS) currency)
  • The leverage ratio set by the account is 100:1, that is, the initial margin requirement is 1% of the contract value
  • 113450 x 0.01 = US $1134.50 (initial margin) {sys: cpfname} the margin ratio set is US $1000 / hand
  • Close 1 standard hand EURUSD contract (buy / long), and the purchase price is 1.13850
  • (1.13850 - 1.13450) x 1 x 100000 = $400.00 loss