How to calculate profit with CFD trading

At IQ Option, the profit in CFD trading depends on which position you open buy or sell.

How to calculate profit for long position

If you are buying an asset and thinking that it will grow in value your position then it is called long.

Long position

There is a formula to calculate the long positions: closing price / (opening price – 1) x leverage x investment.

LONG position – calculation

Let us consider an example: John invested $1000 to buy stocks of ‘A’ company at the opening price of 12 dollars. He applied leverage of one to five. And the stock cost went to $15 when John closed his position. Let’s calculate his profit with the help of the formula.

LONG position profit formula

John made a profit of $1250.

Calculate profit for short position

When you think to sell an asset, you don’t own expecting then that will decrease in value your position it is called short.

Short position

To calculate the profit in short position, the formula is (1 – closing price) / opening price x leverage x investment.

SHORT position profit formula

Let us consider an example: Stephen used $5000 to sell stocks of ‘A’ company. When the position opened the price of the stock was $13 and when Stephen closed his position at $11. Stephen traded with a leverage of one to three.

SHORT position – calculation

Following the calculations, Stephen’s profit resulted in 2250.

Also read: CFDs On IQ Option Made Simpler.

We wish you successful trading.

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