By default, the charts of trading instruments in the trading terminal show the Bid price, but not all positions are closed at this price.
Long positions (Buy) are opened at the Ask price and closed at the Bid price. Short positions (Sell), in their turn, are opened at the Bid price and closed at the Ask price.
As a result, on the chart you can see only the Bid price, at which your long (Buy) positions are closed.
It can be easily changed by enabling the Ask line in chart settings.
Your order could have been closed due to one of the following reasons:
Positions in trading terminals can be opened in several ways. The most common of them is the following:
Also, you can open a new position from the terminal’s main menu or using "One-Click Trading".
The following types of orders may be executed not at the declared price: Buy Stop, Sell Stop, and Stop Loss.
When these orders are triggered, the system sends the Market order, which is executed at the current price at the time of the order processing. This is the reason why there might be differences between the price specified in the pending order and the execution price.
Other types of pending orders, Buy Limit, Sell Limit, and Take Profit, are executed at the specified or better price, if such price exists on the market when they are executed.
The leverage is a ratio between the trader’s own funds and borrowed funds, which a trader borrows from his broker. 1:100 leverage means that for a transaction you must have a trading account with amount 100 times less than the sum of the transaction.
Lot is a unit of transactions in trades.
A Stop order is a trigger, and when it is reached, a corresponding order Market or Limit is generated by the platform.
There are two types of Stop orders:
When trading on the Forex market, you sell or buy financial instruments expecting their prices to fall or rise in the future.
If, according to calculations, the price is going to rise, a trader opens a buy order. Otherwise, they open a sell order.
The profit is the difference between the price, at which a trader buys or sells the chosen asset, and the price, at which the order is closed (minus spread and (or) the broker’s commission).
Let’s consider a simple example:
You purchased 1 lot EURUSD at 1.2291, which means that you bought 100,000 EUR (1 lot is 100,000 units of the base currency, which is the first symbol in the instrument ticker) for 122,910 (1.2291 * 100,000).
After a while, the price went up to 1.2391 and you closed the position. At that moment, the amount you bought remained the same (100,000 EUR), but due to the price change, it cost 123,910 USD (1.2391 * 100,000).
Your profit will be 123,910-122,910 = 1,000 USD.
On Forex market, clients are charged with Rollover (Swap) charges for transiting the position over midnight. The amount of Swap depends on the difference between bank rates of the base currency and secondary currency in a currency pair. Swaps can have either positive or negative value.
RoboForex swap rates are established in accordance with swap rates from our liquidity providers. Current swap rates for each trading instrument can be found in "Contract Specifications" section of our website.
At weekends, the Forex market is closed, just like other global stock exchanges. However, cryptocurrencies are available for trading 24/7.
Trading currencies, stocks, and other investment products is of the market nature and always involves significant risks. Because of sharp market fluctuations, you may both make much of your investments and completely lose them.
You may manage the risks (the ratio of possible financial losses to profits) by using the leverage value, and specific types of orders (Stop Loss / Take Profit) or other available tools. You should always remember that the higher the leverage and possible profit, the higher the risk level.
A pending order is the client's order to buy or sell a financial instrument at the specified price in the future.
There are four types of pending orders:
Buy Limit — to buy, when the future "Ask" price is equal to the specified value. The current price level is higher than the value of the placed order. Execution of this type of order means that the transaction will be made at the price specified in the order or at the price that is lower. Orders of this type are usually placed in anticipation that the instrument price, having fallen to a certain level, will increase.
Buy Stop — to buy, when the future "Ask" price is equal to the specified value. The current price level is lower than the value of the placed order. Execution of this type of order means that the transaction will be made at the price existing at the moment when the order is executed, which may be different from the price specified in the order. Orders of this type are usually placed in anticipation that the instrument price, having reached a certain level, will keep increasing.
Sell Limit — to sell, when the future "Bid" price is equal to the specified value. The current price level is lower than the value of the placed order. Execution of this type of order means that the transaction will be made at the price specified in the order or at the price that is higher. Orders of this type are usually placed in anticipation that the instrument price, having rising to a certain level, will decrease.
Sell Stop — to sell, when the future "Bid" price is equal to the specified value. The current price level is higher than the value of the placed order. Execution of this type of order means that the transaction will be made at the price existing at the moment when the order is executed, which may be different from the price specified in the order. Orders of this type are usually placed in anticipation that the instrument price, having reached a certain level, will keep decreasing.
There are two types of Stop Out in cTrader platform, Fair Stop Out and Smart Stop Out.
Fair Stop Out logic is similar to Stop Out in MetaTrader 4/5 platforms.
When reaching it, the platform starts closing the positions with the biggest Margin in order to restore the Margin Level for other open positions.
Smart Stop Out logic only closes a part of the position with the biggest Margin in order to always keep the Margin Level a bit above the current Stop Out level.
Please note that the example doesn’t take into account spreads and (or) brokers’ commissions.
We are given:
Account balance: 500 USD.
Account equity: 500 USD.
Smart Stop Out: 50%.
Margin Level: 100%.
Open position No.1: Buy 200,000 USDJPY.
Open position No. 2: Buy 50,000 USDJPY.
Once the price of USDJPY falls by more than 10 pips, the Margin Level will become less than 50% and trigger the Smart Stop Out feature.
Pip value for 250,000 USDJPY: 2,500 JPY (24.67 USD).
Loss in pips: 10.2.
Unrealized profit/loss: 24.67 USD * 10.2 = 251.63 USD.
Equity: 500.00 USD – 251.63 USD = 248.37 USD.
Margin Level: 248.37 USD / 500.00 USD * 100% = 49.7%.
As we can see in the example, the account Margin Level fell below Smart Stop Out. In this case, cTrader platform will partially close the largest position (Position No 1), in order to free the required Margin amount.
The position of 200,000 USDJPY will be modified into 198,000 USDJPY by selling 2,000 USDJPY.
Pip value for 2,000 USDJPY: 0.1973 USD.
Loss in pips: 10.2.
Loss amount: 0.1973 USD * 10.2 = 2.01 USD.
Unrealized loss/profit: 251.63 USD – 2.01 USD = 249.62 USD.
Margin used for 248,000 USDJPY: 496.00 USD.
Due to the loss, the account Balance and Equity will change in the following way:
Balance: 500.00 USD – 2.01 USD = 497.99 USD.
Equity: 497.99 USD – 249.62 USD = 248.37 USD.
Margin Level: 248.37 USD / 496.00 USD * 100% = 50.1%.
As a result of Smart Stop Out, the Margin Level went up to 50.1% with the minimum effect on the total balance of the trading account.
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