Hi all
So just to make sure I understand, to calculate the lot sizes as at 18:30 EST they would be:
EURUSD 1/1.2996 = 0.77 lots
GBPUSD 1/1.9390 = 0.51 lots
USDCHF 1.2418 = 1.24 lots
USDJPY 119.31 = 1.19 lots
Total lots = 3.71
Can somebody please confirm that's correct?
Stevensign, on the Forex-TSD board, suggested taking into account each pair's daily range.
http://www.forex-tsd.com/76193-post373.html
Is there an advantage in doing that? I didn't understand why the DR was only applied to the non USD based pairs though...
Thanks
Quote:
Originally Posted by dcraig
Just making a few "leaps" here ...
Let's assume we have a USD $4,000 account using 1:100 leverage. If we wanted to risk 10% of the account, that would be $400. Therefore, we'd want to apply roughly $100 to each of the four currency pairs. Lets assume we're looking at EURUSD, USDCHF, GBPUSD and USDJPY. For the two USD base currency pairs, the calculation is easy ($100 x 100 leverage = $10,000, or 10 micro-pips). For the other two currency pairs, it's almost as easy. Let's look at EURUSD for example. The current bid is around 1.30 (US$1.30 for each euro). The inverse of this is EUR$0.77 euro's for each USD. Since we want to open a position with an equivalent value of USD$10,000, we would multiply 0.77 times $10,000, which would give us a value of about EUR$7,700, or approximately 8 micro-lots. We would do the same with the GBPUSD, which would yield an initial position size of 5 micro-lots.
I think this would give us an approximately equal opening position size for all four currency pairs. Nobody will hurt my feelings if I'm off base here, but it seems logical to me...
Doug
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