So far, we have introduced the US dollar / yen, but the trading mechanism is exactly the same for currency pairs other than the US dollar / yen. If the cross yen is a currency pair of a currency other than the US dollar and the yen, the profit and loss calculation method is the same as the US dollar / yen.
For currency pairs between foreign currencies , it is necessary to convert the difference in exchange rates generated in the transaction into Japanese yen. Generally, it is calculated using the exchange rate at the time of settlement of the currency pair (cross yen) that combines the currency and yen displayed on the right side (after) of the currency pair traded .
For example, in the case of Euro / US dollar, the US dollar is displayed on the right side, so the profit / loss is converted to Japanese yen using the US dollar / yen rate, which is a combination of US dollar and yen. Euro / Australian dollar is Australian dollar / yen, Euro / British pound is British pound / yen, US dollar / Turkish lira is Turkish lira / yen, and so on.
If you buy Euro / USD for $ 1.10 and sell and settle for $ 1.12, the profit per euro is $ 0.02 . It costs $ 20 for 1000 currency transactions and $ 200 for 10,000 currency transactions.
If the US dollar / yen rate at the time of settlement is 100 yen, the fixed profit of 10,000 currency transactions will be 20,000 yen . However, if the US dollar / yen rate at the time of settlement is 110 yen, the fixed profit will be 22,000 yen even for the same transaction .
[If you trade 10,000 currencies in euro / US dollar and make a profit of 200 dollars]
・ If the US dollar / yen at the time of settlement is 100 yen … 200 dollars x 100 yen = 20,000 yen
・ The US dollar / yen at the time of settlement is If it’s 110 yen … 200 dollars x 110 yen = 22,000 yen
In this way, in the case of transactions between foreign currencies, even if the price range difference caused by the transaction is the same, the fixed profit / loss amount on a Japanese yen basis will differ depending on the US dollar / yen or cross yen rate. When trading currency pairs between foreign currencies, the calculation method of profit and loss becomes a little complicated, but since the FX trading itself is a difference settlement, there is no need to prepare foreign currencies and all can be traded in Japanese yen.
