DitsIntelligence: Latest Global Market News, Forex Market Education

 

In the Forex market (FX),  a lot  is commonly traded in specific amounts or, in the simplest terms, the number of currency units you will be purchasing or selling. A  lot  is defined as a unit of measurement for a specified transaction amount. On the trading platform, orders are placed in sizes that are quoted as  lots . It’s similar to an egg carton or an egg box. Usually, when you buy eggs, you will purchase them in a carton or box, and one carton includes 12 eggs. The standard lot size is 100,000 units of currency. Besides, there are mini (10,000), micro (1000), and nano (100) lot sizes. LOT NUMBER OF UNITS Standard  100,000 Mini 10,000 Micro 1,000 Nano 100 A few brokers show quantity in  lots  while others display it in the actual currency units. As we previously discussed, the variation in the currency value relative to another is measured in  pips ,  which is a very, very small percentage of the currency value unit. In order to take advantage of these frequent value changes, you

A "pip" is a unit of measurement used to describe the difference in value between two currencies. A .0001 USD increase in value equals ONE PIP if EUR/USD increases from 1.1050 to 1.1051. The last decimal place of a pricing quote is commonly referred to as a pip. There are rare outliers, such as Japanese yen pairs, which go to four decimal points (they go out to two decimal places). For example, it is 0.0001 for EUR/USD and 0.01 for USD/JPY. A "pip" is a unit of measurement used to describe the difference in value between two currencies. A .0001 USD increase in value equals ONE PIP if EUR/USD increases from 1.1050 to 1.1051. The last decimal place of a pricing quote is commonly referred to as a pip. There are rare outliers, such as Japanese yen pairs, which go to four decimal points (they go out to two decimal places). For example, it is 0.0001 for EUR/USD and 0.01 for USD/JPY. What is a Pipette?  There are forex brokers who quote currency pairings to "5 and 3

For each currency pair, forex brokers will provide you two separate prices: the bid and ask price.  The " bid " is the price at which the base currency can be SOLD. The " ask " is the price at which the base currency can be purchased. The spread is the difference between these two prices. Also referred to as the " bid/ask spread ."  What is the spread in forex trading ? Brokers who do not charge commissions rely on the spread to make money. This spread represents the cost of enabling instantaneous transactions. This is why " transaction cost " and " bid-ask spread " are interchangeable terminology. The cost of making a trade is included into the buy and sell price of the  currency pair  you want to exchange, rather than being charged separately. This makes sense from a business aspect. The broker provides a service and must earn a profit in some way. They profit by selling the currency to you for a higher price than they purchased for i