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Stop Loss and Take Profit in Forex Meaning
Stop loss and take profit in forex meaning explained clearly for beginners. Learn how they work and how to use them correctly.
Profit calculator
What a trade made or lost between its open and close prices, in pips and in your account currency.
Result
Profit
+500.00USD
+50.0 pips on 1.00 lot, bought.
- Price move
- +0.00500
- Position
- 100,000 EUR
No exchange rate needed: the figures are already in USD.
Exchange rates: ECB reference rates, Nov 6. Reference rates are set once each business day, so results can differ slightly from a broker's live price. Everything is calculated in your browser; nothing you enter is sent anywhere.
How it is calculated
A buy profits when the price rises and a sell profits when it falls. The difference between the close and open prices, multiplied by the size of the position, is the result in the quote currency.
profit = (close − open) × units × (+1 for a buy, −1 for a sell)pips = (close − open) ÷ pip size, signed the same way
When the account is held in another currency, the result is converted at the latest rate. For a trade closed on an earlier day the rate at the close would give a slightly different figure. The calculation leaves out the spread, commission and overnight financing, which a broker charges separately.
Worked example
- Buy one lot — 100,000 euros — of EUR/USD at 1.1000 and close at 1.1050.
- The price rose 0.0050, or 50 pips.
- 0.0050 × 100,000 = 500 US dollars profit. Had the trade been a sell, the same move would have lost 500 dollars.
Risk. These tools do arithmetic on the figures you enter. They are not advice, and unless a field asks for them they leave out spreads, commission, financing and slippage. Past results do not predict future ones. Trading leveraged currency products carries a high risk of loss. Read our financial disclaimer.