Formula

Compound Interest Rate Formula: Understanding & CalculatingFX Trading Returns

4 min read

Compound interest rate formula is a calculation used in forex trading to determine how much profit or loss will be produced by a certain trade. It is used mainly to calculate the return from an investment over a period of time. By taking into account the changes in the exchange rate between two currencies, as well as the number of days over which the trade is kept open, the formula can determine how much we could have made or lost. This formula is of special importance for forex traders as it can help them make smarter, more informed decisions when trading currencies.