Opening Trading Positions
Open trading positions with one click
In this example, we’re going to show you how to Buy or Sell using the Absolut Ability trading platform.
Depending on the instrument you want to Buy or Sell, simply follow this example:
Trading Forex – Buying or Selling Forex: Go ahead and choose the basic units or lots you want to buy or sell.
Trading Share CFDs – Buying or Selling Share CFDs: Go ahead and select the number of shares you want to buy or sell.
Trading CFDs on Indices – Buying or Selling Indice CFDs: Simply select the number of contracts you want to buy or sell of a specific Index, let’s say the DAX. Each transaction represents a multiple of USD, EUR or any other currency of the value of the traded Index.
Trading CFDs on Commodities – Buying or Selling Commodity CFDs: Go ahead and choose the number of basic units or lots that you want to buy or sell of the said Commodity.
Risk Management: Placing Your Stop Limit (a.k.a. Take Profit). This is where you close your trade at a specific profit rate. Go ahead and enter the sell or buy Stop Limit amount you want to close your position at. This represents the profit you want to gain out of the trade. The default Stop Limit amount is usually 1 pip above or below your purchase or sale rate.
Risk Management: Placing Your Stop Loss. We advise all our traders to enter a Stop Loss as this limits the amount you could potentially lose in any given trade you open. The default Stop Loss rate is usually 1 pip below or above your purchase rate. Please note that after a favorable market rate movement, manually adjusting your Stop Loss rate is possible, and you can do this by clicking on the Edit Position button. This ensures your profits are locked in for you.
Risk Management: Placing Your Limit Order. You place a Limit Order to buy or sell an instrument when it hits a specific price point. Let’s say Apple’s share price is at $100. You want to buy when it reduces to $98.50 per share. When you set your Limit Order to $98.50, our trading platform will either buy or sell the Apple shares when they hit $98.50.
Here’s an example of opening a trading position with Absolut Ability. To kick off this example, let’s say you deposited $1,000 via your credit card.
Your balance is $1,000. This is because you deposited $1,000. Here’s the formula:
Deposits – Withdrawals + P&L of closed positions.
Your P&L is $0, and here’s why:
Total Profit and Loss of all open positions including Premium.
Your available balance is $1,000. Here’s the formula:
Balance + P&L of open positions – Initial margins.
Your equity is $1,000 because of this formula:
Balance + P&L of open positions.
At 1 pm, you click to Buy Gold, which has a market price at that time of:
Sell $1,199.65 / Buy $1,200.35 per ounce of Gold.
Here’s your trading criteria as it stands:
Number of Gold ounces: 10
Close at Profit rate: $1,250
Close at Loss rate: $1,150
In this example, you purchased 10 ounces of Gold at $1,200.35, so here’s the formula:
10 x $1,200.35 = $12,003.50
Your maintenance margin required to maintain your Gold position open is 0.3%, which equals to $36.01.
Your P&L at this point is 0. The usual spread of Gold is 50 to 70 cents, so you have a P&L of -$7
Your available balance after you purchased the Gold CFD is $939.99. Why? Here’s the formula:
$1,000 ($12,003.50: 200)
So your available equity is $1,000 ($1,000 + $0)
At 2.15 pm, you see that the price of Gold jumps to $1,250.
Your P&L at this point is +$496.50. Here’s why:
10 x $1,250 – 10 x $1,200.35, which is the per ounce of Gold you bought it for.
Now your equity is $1,496.50, and the formula is $1,000 + $496.50. The $1,000 is the amount you deposited and the rise is Gold represents the $496.50.
Remember the amount you placed as your Take Profit? It was $1,250. Because Gold hit that price point, your Take Profit order executes and your trade is closed. This means you made a profit of $496.50. Congratulations!
Your trading account equity now stands at $1,496.50 and you can choose to withdraw the entire amount or continue trading.
Your P&L is 0 as you have no open positions.
As we said, your available balance is $1,496.50
What would happen if the price of Gold fell to $1,150 instead of rising?
Your P&L would have been -$503.50 and this is due to this formula:
10 x $1,150 – 10 x $1,200.35.
Your equity would then be $496.50. Why? Based on this formula:
$1,000 – $503.50
Your P&L would be 0 as you would have no open positions.
Your available balance would be $496.50
Ready to trade?
Get started with your Absolut Ability account today.