Profit Calculator

How Profit and Loss Is Calculated in Forex

Forex profit is determined by three factors: the price difference between entry and exit, the position size, and the pip value of the pair. The calculation is straightforward once you understand how these three variables interact.

For a long trade on EUR/USD: buy at 1.1000, sell at 1.1050 on 1 standard lot. The price moved 0.0050 (50 pips). Profit = 0.0050 × 100,000 = $500.00. If the trade were short, you'd enter at 1.1050 and exit at 1.1000 — same 50-pip move, same $500 profit, just in the opposite direction.

Pips vs Dollar Profit

A pip represents the smallest price movement, but the dollar value depends entirely on position size. A 50-pip move on EUR/USD yields:

JPY Pairs

Japanese yen pairs quote to 2 decimal places, so 1 pip = 0.01. USD/JPY at 150.00 moving to 150.50 is a 50-pip gain. On 1 standard lot: 0.50 × 100,000 = ¥50,000. At an exchange rate of 150.00 JPY/USD, this equals approximately $333.33.

Account Currency Conversion

Profit is always calculated in the quote currency first. If your account is in a different currency, the profit must be converted. For example, trading GBP/JPY with a USD account means converting JPY profit to USD at the current rate. The calculator handles this conversion when you select your account currency and provide the current exchange rate.

Frequently Asked Questions

How do you calculate profit and loss in forex?

P&L = (Exit Price - Entry Price) × Position Size for long trades, or (Entry Price - Exit Price) for short trades. For EUR/USD: buying at 1.1000 and selling at 1.1050 on 1 lot yields (0.0050 × 100,000) = $500 profit.

What is the difference between profit in pips and profit in dollars?

Pips measure price movement regardless of position size. A 50-pip move could be $5 (micro lot), $50 (mini lot), or $500 (standard lot). Dollar profit = pips × pip value × lots traded.

How do I calculate profit for JPY pairs?

JPY pairs use 0.01 as the pip size. USD/JPY moving from 150.00 to 150.20 is 20 pips. On 1 standard lot: 20 pips × ¥1,000/pip = ¥20,000. Convert to your account currency at the current rate.

Does profit calculation change for short trades?

The formula reverses: you profit when price falls. If you short EUR/USD at 1.1050 and cover at 1.1000, your profit is (1.1050 - 1.1000) × 100,000 = $500 — same as a 50-pip long but price moved down.