Example of buying Facebook stock:
1. Choose a particular asset
Let's take Facebook stock as an example. The price is currently 116.88/117.03 USD.
2. Sell or buy.
You choose to buy 50 shares at the offer price of 117.03 USD because you believe the market will rise (otherwise you could sell at the bid price of 116.88 USD if you believed the market will fall).
3. Commission and margin
In this example, your total exposure is 50 shares x 117.03 USD (buy price) = 5,851.5 USD.
Commission rate: minimum 0.015 USD per share = 1.5 USD. Therefore, the commission for opening a position is 1.5 USD.
The margin required on Facebook stock is 5%, so to open this trade you would need to have 5,851.5 USD x 5% = 292.57 USD in your account (or the equivalent in other currency).
4. Closing your trade.
Over the course of the day, the market rises, and Facebook's stock price is 132.52/132.67 USD. You choose to close your trade at the price 132.52. The commission charged for closing the position is 1.5 USD.
5. Profit/Loss Calculation
There are two profit calculation methods in our trading platform.
The first method is applied to positions in Stocks, ETFs, and CFDs on all these.
Calculation formula:
Short position (Sell)
(<Opening price> * <Position volume> - <Closing price or last price> * <Position volume>) + <Additional expenses>
Long position (Buy)
(<Closing price of last price> * <Position volume> - <Opening price> * <Position volume>) + <Additional expenses>
Example:
Twitter: 100 shares, long position (buy), opening price: $22.00 USD, last price: $26.00, commission: $-1.50, interest: $0.49.
(26.00 * 100 – 22.00 * 100) + (-1.50 – 0.49) = $398.01
The second profit calculation method is applied to positions in all other instruments except for Stocks, ETFs, and CFDs on all these.
Calculation formula:
Short position (Sell)
(<Opening price> - <Closing price or last price>) * <Position volume> + <Additional expenses>
Long position (Buy)
(<Closing price or last price> - <Opening price>) * <Position volume> + <Additional expenses>
Please note that real stocks are not available for trading to clients from Afghanistan, Bosnia and Herzegovina, Vanuatu, Venezuela, Guyana, the Democratic Republic of the Congo, Iraq, Iran, Yemen, Cuba, Laos, Libya, North Korea, Syria, Somali, Uganda, and the Central African Republic.