On the MT4 platform, the word “lot” refers to the size of an investment. The larger the size of the investment, the higher the value of pips, which leads to higher the profit.
The three top time-consuming factors are usually family, kids, and work. The most redundant questions that beginners usually ask themselves before they start trading are:
Below Are Approximate Pips According To The Size Of Investment:
- I0.01 lot: 10 cents per pip
- I0.10 lot: $ 1 per pip
- I1.00 lot: $ 10 per pip
- I10.00 lot: $ 100 per pip
- I100.00 lot: $ 1000 per pip
- IAnd so on….
Now That You Know Your Investment Sizes, You May Take A Look At The Approximate Investment (Lot) Of The Positions You Can Open Relative To The Currency You Have Invested In:
- $ 50: up to 0.10 lots
- $ 200: up to 0.40 lots
- $ 1,000: up to 2.0 lots
- $ 5,000: Up to 10 lots
- $ 10,000: up to 20 lots
- $ 40,000: up to 80 lots
- $ 100,000: up to 200 lots
- $ 500,000: up to 1,000 lots
- And so on….
On average, the EUR / USD pair is trading 216 pips a week, until the time these lines are written at the beginning of 2012. However, this does not mean you can only make 216 pips a week when investing with a EUR / USD pair. And, if you win a double 200 pip, you can earn 600 pips in total, 200 pips from each position. If you are not familiar with Forex trading, do not worry. It is pretty simple! Basically, there are 2 currencies invested against each other, and they are called a “pair”. For instance, assume that the EURO and USD are trading at 1.3187 if you think this price will increase, then you are recommended to purchase, and vice-versa, if you think that the price will drop, then you are recommended to sell.
EUR/USD are the most invested currency pair in the Forex market. And of course, prices are always moving since the market is dynamic.
If the price rises from 1.3185 to 1.3187, you can earn 2 pips in this case. Similarly, if the price drops from 1.3185 to 1.3187, then a loss of 2 pips occurs. If you anticipate price increases, you should buy it, you should sell it if you anticipate it will fall.
The higher the investment size, the higher the pip value and the higher the profit!
So far, the basic rationale behind forex trading is as you can see, is not that difficult. When you invest in currencies such as the Euro and the US Dollar, you always have a chance to make a profit as the value of money is constantly changing. This profit can only appear in a matter of minutes, but your investment plan can also occur in a few weeks or even a few months, depending on your plan. Here at Invests360, you will be able to trade on many different currency pairs.