A Foreign exchange quote , e.g. EUR/USD "1.2700 /03" represents the bid / offer spread in this case for EUR / USD. The rate of 1.2703 is the rate at which you can Buy EUR against the US Dollar. The rate of 1.2700 is the rate at which you can Sell EUR against the US Dollar.
Opening Trade
| Price Shown | 1.2700 Bid / 03 Offer |
| Sell Price | 1.2703 |
| Quantity size | 100,000 |
| Margin Required (2%) | 100,000 x 1.2703 x 2% = $2,540.6 |
| $20.00 | |
| | |
The Euro appreciates against the US Dollar and the client wishes to close the position. OFB is now quoting 1.2750 / 1.2753.
Closing Trade
| Price Shown | 1.2750 Bid / 1.2753 offer |
| Buy Price | 1.2753 |
| Price/point movement | 50 points |
| Gross profit/loss | 50 x $10 = $500.00 profit |
| | |
| Net profit/(loss) | $ 500 – (Commission $ 20) = $480 |
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