Hi Guys, Just need confirmation. Let's say I open 1 long position at 0 Then the price goes up to 10 where I add 1 long postion. Therefore my average open positions is 5. If the price goes down to 7,5 and I short to close 1 contract. Do I lose money (-2,5) from my contract bought at 10 ? No .. I pocket 2,5 from my average open position (5). Right ?
No the general accting principle is FIFO, first one in, first out. So basically you closed the first contract (bought at 0) out at 7.5 i.e. a profit of 7.5 whilst you now are showing an open loss of 2.5 on the second contract.