IB IDEAL PRO EURGBP Calculation help

Discussion in 'Forex' started by Digs, Jun 29, 2006.

  1. Digs


    Need help with this

    TWS reads like this.
    Underlying > EUR
    Exch > IDEALPRO
    Description > GBP/EUR Cash EUR.GBP

    Forex Pair to Trade EURGBP
    Underlying is EUR ( as per TWS)
    IB TWS UNDERLYING QTY = $100,000
    MARGIN IS = 4088 USD

    PRICES BIDs as at posting time.
    EURGBP = .6905
    EURUSD = 1.2544
    GBPUSD = 1.8171

    Q: What is the $USD Value of the a single PIP move of my underlying 100,000 EUR ?

    IB, this is not easy !!!!
  2. Steve_IB

    Steve_IB Interactive Brokers

    Your profit will be based in GBP.

    In the underlying you have EUR. This means that when you place a trade you are buying or selling Euro.

    So if you buy 100,000 at 0.6905, this means you are buying Eur 100,000 and paying GBP.

    The amount you are paying is 100,000x0.6905, ie. 69,050 pounds.

    Now assume you sell 100,000 Euro at 0.6910. You will receive pounds, calculated as 100,000x0.6910, which is 69,100 pounds.

    Thus, your profit is GBP50. So the value of a single pip is GBP10.
    This would be a fixed amount.
    The dollar value of this will vary with the GBP/USD, and in your example would be GBP10x1.8171 = US$18.71 per pip.

    Here's another, easier way to calculate your pip value, is decide on your trading size, then multiply that by one pip which for most currency pairs will be 0.0001 and the currency of this will be the one that is not in the underlying column.

    e.g. EurUsd =1.2544
    Euro is in the underlying.
    You buy 200,000.
    200,000x0.0001 = US$20

    Hope that helps
  3. bl33p


    100,000 euro of EUR/GBP pip value is 18.17 USD or so, copied from Oanda's order box which shows the values immediately, rates almost as you quoted.

    Sorry didn't see Steve's reply when writing this. But Steve tell me, when are you going to update TWS so that it can feasibly be used for forex trading, showing profit/loss per trade in the account summary and other such necessities?
  4. Steve_IB

    Steve_IB Interactive Brokers

    It could be a while. For now, you'd have to use third-party software such as Button Trader, or you could set one up for yourself using the Excel API DDE link.

    What other necessities apart from the P&L are you looking for?
  5. bl33p


    To see each trade as a separate entry with its own P&L, able to close this trade separately from others. Also complete exposure and average P&L for all trades of one currency pair.

    To see swap fees readily calculated in both currency and pip terms for a pair when opening a trade in order to know how much holding it will cost/earn.

    To see pip value for a trade, can I say this thread! Both pair base and account base.

    You could do worse than see how extraordinarily clearly Oanda's FXGame shows it all. There's no guesswork or fuzziness in there. How easy it is to read the trades and positions tabs. Granted, even they don't show swap interest when opening a trade.

    With TWS, I have a feeling that my trade goes 'somewhere'. There is no control or exact data about it. It feels very uncertain and fuzzy.
  6. Fohat


    A single PIP[=0.0001] move of your underlying 100,000 EUR is = 100,000 x [0.0001]GBP = 10 GBP = $18.171 USD

    Thus, the answer is $18.171 USD.