For instance, if you could buy one euro today for $1.10 but market traders are willing to sell you that same euro three months from now for only $1.08, that's a forward discount on the euro. This pricing suggests traders expect the euro to weaken against the dollar. Below, we take yo...
Parity is also found in foreign exchange (forex) markets, the exchange rate relationship between two currencies is exactly one-to-one. Companies based in the United States that have operations in foreign countries must convert U.S. dollars into other currencies. If a U.S. firm does business ...
The quick ratio is a calculation formula that measures to what extent a company can meet its short-term liabilities with liquid assets.
Let’s take another example. Suppose Mr. A is a resident of the U.S. and converts 500,000 USD to 451,392 EUR. In this case, find the indirect quote for Mr. A. Here in this example, a USD will become the domestic currency For Mr. A. And the counter currency will be the Euro...
Says Kirchhoff: "It was as though we went from dollars to euros overnight." Considering the plight of the euro lately, there are those who consider the metaphor especially apt. Kirchhoff maintains a fist-pounding but eminently entertaining blog called Man Meets Scale, in which he damns the ...
Dollars to risk / (risk in pips x micro lot pip value) = micro lot position size $20 / ($50 x $0.10) = 4 micro lots The ideal position size for the 50-pip stop loss, given the trader is willing to risk $20 on the trade, is four micro lots. Working backward, if the trader...