# Interesting calculation

35
2014.12.11 13:07

Hi,

How do I calculate the minimum volume needed to make a minimum amount of profit with a predifined number of points?

Example:

My account is in USD

Position is EURGBP

Open price is 0.79410

Take profit is 0.79500 (+90 points)

How do I calculate the minimum volume to make \$150 profit on this?

Thanks

5782
2014.12.12 03:58

Hi roamso

There's a couple of ways to work it out (and I'm assuming you meant you want \$150 USD profit?). Here's one way.

The profit or loss per pip is always calculated based on the quote currency (GBP in your example). So first thing is to work out how many £ GBP equals \$ 150USD.

If current GBPUSD = 1.57000:

\$150 USD =  150/1.57

=  £ 95.54 GBP profit required to equal \$ 150 USD

We also know that a 1 pip movement at 1 standard lot in a currency is equal to 10 units of the quote currency. So that equals £ 10 GBP per pip n this example. So if we see a 9 pip move (90 points) that would be:

1 lot * 9 pips * £ 10 GBP per pip = £ 90 GBP

Now, you want to make £ 95.54 so it's simply: £ 95.54 / £ 90 = 1.06 lots

You can confirm that by working backwards using the formula

Profit/Loss per pip = trade volume x pip size

So for a EURGBP 1.06 lot trade:

Profit/Loss per pip = 106,000 x 0.0001 = £10.6 GBP