|
Account Types and Trading Terms
Posted by on 17 February 2014 01:08 PM
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1. What types of accounts does FXOpen provide? FXOpen offers the following types of accounts: STP and ECN. For more information, please click here. 2. What instruments does FXOpen offer for trading? There are 50 currency pairs, along with gold and silver available for trade. On ECN accounts CFDs, Oil and Natural Gas are also available. See the full list of instruments for STP and ECN accounts. Currencies are available for trading 24/5 from Monday to Friday. 3. Do you provide SWAP-free accounts? FXOpen AU does not offer SWAP-free accounts as Commonwealth Bank of Australia does not provide this as an option. On the Forex market open positions rollover is done in the form of SWAP. If your position stays open for the night or over the weekend there is a daily rollover interest rate that is either added or deducted to or from your account. It depends on the currency pair you trade and the transaction type (Buy or Sell). Opening a trade means that you borrow one currency to buy another. As we don’t know how long the trade will remain open, SWAP is added or deducted when the position is rolled over the night. We add/deduct SWAP to/from the account according to the difference between the interest rates of the currencies in the pair. If the interest rate of the currency that you buy is higher than the rate of the currency you borrow, SWAP is added to your account (positive SWAP). If the interest rate of the currency that you buy is lower than the rate of the currency you borrow, SWAP is deducted from your account (negative SWAP).
To look up swap rates in the MetaTrader please take these steps:
Our spreads are not fixed and depend on the buy and sell orders, which are currently available in the Marketplace. Stop Loss Orders - Execution Rules Good Till Cancelled (GTC) Orders - Execution Rules Margin - the amount of cash or other Eligible Collateral that FXOpen requires a customer to deposit or maintain in the Customer's Account in connection with the Customer's trading activity. Margin is usually 1-2% of the transaction amount; the remaining 98-99% is given by the dealer. This is the leverage in Forex terms. For example, if you would like to buy $10,000 for JPY and your leverage is 1:10, you need to pay 1,000 JPY. The system performs an automatic pre-deal check for Margin availability, and will only execute the deal if the client has sufficient Margin funds in his or her account. To calculate the Margin it is required to open a trade, you can use the following formula:  Example 1. Leverage=1:200, volume=0.1, EUR/AUD: EUR/USD (Market price is 1.38430/450).
Example 2. Leverage=1:200, volume=0.1, CHF/JPY: USD/CHF (Market price is 0.98830/0.98860).
Example 3. Leverage=1:200, volume=0.1, USD/CHF.
Example 4. Leverage=1:200, volume=0.1, NZD/USD: NZD/USD (Market price is 0.75020/0.75070).
8. Can I get Margin Call if I have no free Margin? Margin Call happens when a client's account equity falls below the required Margin to maintain open positions. It’s done automatically. On STP accounts Margin Call happens when Margin level falls below 50%. The losing orders are closed automatically by Stop Out at Margin level of less than 30%. On ECN accounts Margin Call happens when Margin level falls below 100%. The losing orders are closed automatically by Stop Out at Margin level of less than 50%. Example The 1 lot trade opened on ECN account with a Margin requirement of $300 will be subject to a Margin Call when the account Equity falls to $300 or less. When the Equity falls below $225 the order will be closed automatically by Stop Out. Please, note that If the order was closed by Stop Out, you can find the information about it in trading terminal MetaTrader 4. Open the window Terminal, the tab Account History and check the column Comment. If you cannot find this column in the tab Account History right click in the tab and choose Comments. A critical loss level - Stop Out - is fixed to prevent trader losses in excess of the Margin and available funds on the trading account. Upon reaching this level, broker automatically closes all loss-making positions at the current market price when Margin Level is lower than Stop Out level. Thus positive account balance is kept.
* Only USD containing currency pairs can be used to calculate Stop Out prices for cross-rates since it is impossible to foresee exchange rates of two currency pairs at one and the same time in future.
where P&L — is Profit and Loss; 10. How long does it take to confirm a deal? Deals are confirmed on screen, typically within 1-2 seconds. The full transaction details including the reference number, date, time, notional amount bought and sold, Stop loss and Take profit levels may be accessed in the MetaTrader 4, window Terminal, tabs Journal and Trade. 11. Does FXOpen offer bonuses? FXOpen AU does not offer bonuses. 12. How long are positions maintained? As a general rule, a position is kept open until one of the following occurs:
13. How do I calculate the value of 1 Pip? Pip value for ECN/STP accounts (5th decimal pricing) Quotes with 5 decimal places allow better transparency and better ability to catch better deals. For example, instead of 2 pips spread (1.50300 Bid 1.50320 Ask), a trader can get a 1.7 pip spread (1.50301 Bid 1.50318 Ask). To know what a pip is in 5 digit quote, take the exchange rate and count 5 digits backwards. For instance, the EUR/USD is at 1.00615. Count 5 digits from the first: 1, 0, 0, 6, 1. The 1 is the 5th digit in the quote and it's at the 4th position after the decimal point, so a pip for the EUR/USD is 0.0001. The last digit in 5 decimal pricing is a ‘fractional’ pip. In our example is 8.1 ‘fractional’ pip is 0.1 of a pip. To calculate pip value you can use the following formula:
Example 1. 0.1 standard lot EUR/USD at the price 1.33391.
To convert EUR 0.07496 to USD you must multiply:
  As you can see from the example 1 - ‘Fractional’ pip value is $0.1 that means 1 pip value is $1.
As you can see from the example 2 - ‘Fractional’ pip value is $0.1 that means 1 pip value is $1. 1 pip (point) – is the smallest change in currency quotations, no matter in what direction a change occurs, up or down. For example, the exchange rate for EUR/USD has changed from 1.3614 to 1.3617, i.e. by 3 points. A pip is equal to 0.0001 for the nine major currency pairs. For pairs, where the Japanese yen (JPY) is the quote currency, 1 pip is equal to 0.01. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
 (4 vote(s)) This article was helpful This article was not helpful |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
