Assume that; you have an idea about increasing of Eur/Usd parity. It means euro will be weaker and dollar will be stronger.(the first money unit is base unit. You want to buy or sell it.)

Margin rule is %1. It means that; you can buy or sell with multiple 100 of money. For instance, if you have 100 euro on your account you could sell or buy 100,000 Eur/Usd parity.

Assume that; you want to buy 100,00 Eur/Usd parity. buying price is 1.3550 and selling price is 1.3552

You bought 100,000 Eur/Usd from 1.3552

If price decreases; There will be a loss because of buying from 1.3552 You can close buying transaction with selling. Imagine that; you closed this position with selling on 1.3515

LOSS;

For 1 Euro, 1.3552-1.3515 = 0.0037 Usd We have 100,000 Euro. So TOTAL LOSS will be 100,000 X 0.0037 = $ 370

If the price increases there will be a profit because of your buying on 1.3552. you can close buying with selling. So if the price increases the profil would increase. Imagine that; you closed this position with selling on 1.3580.

PROFIT;

For 1 Euro, 1.3580-1.3552 = 0.0028 Usd We have 100,000 Euro. So TOTAL PROFIT will be 100,000 X 0.0028 = $ 280

Note: If you buy parity it means you are interested in high prices (you want increasing of prices), if you sell parity it means you are interested in low prics (you want decreasing of prices).

You can see how you earn or loose money when you buy 100,000 Eur/Usd parity. Please be careful about that; your profit or loss will be on the second parity.

It is adviced to put stop loss when you do operations according to separating strategy.

If the market seriously goes to unexpected direction stop loss would close your position automaticly and protect you for a measure. You should know that stop loss hasn’t guaranty. Because sometimes you can see stop loss runs on a different rate. This is called as gapping.

If the market goes to expected direction you can also put limitation or take profit orders. If the price comes to where you want your position would close automaticly.