Forex statement
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Introduction:
Statement is one of the tools that can help us to accurately evaluate the transactions we have done. In this article, we will examine the statement in forex, the reason for its importance and the details that are usually included in it.
What is a statement?
A statement in forex is actually like a bill that shows all transactions made in a certain period. Just as you can see your transaction records by logging into the bank’s website or banking application, a part of the trading platform provided by the broker is dedicated to your transaction records, which is called “Statement”. In fact, you can consider the statement as your ledger in forex trading, where the details of your trading activities are entered. The statement includes all transactions, profits, losses, costs and other details related to each transaction.
Why is the statement important in Forex?
The statement is very important for the following reasons:
1. Record keeping
The statement provides a detailed history of all your transactions, which can be useful for checking the resulting profit or loss.
2. performance analysis
By reviewing your statement at different time periods, you can analyze your trading performance, identify trends and, if necessary, make changes to your trading methods or strategies.
3. transparency
The statement makes the communication between broker and traders transparent. In a statement, you can see the details of the types of fees that the broker has deducted from your account. This transparency leads to increased trust.
Details included in the forex statement
If you have just entered the forex market, you may be a little confused when you see your statement; Because you will probably see a series of terms in it that you have not seen before. Let’s take a look at some of the most common terms in the statement and what each of them means:
- Account summary : It includes account number, account type and the currency you use.
- Balance : The total amount of money left in your account after closing all transactions.
- Equity : Your total balance plus total profit ( or minus total loss) from open trades, which is calculated instantly.
- Margin : The amount of money (collateral) required to open a trading position.
- Free margin : The amount of money you have in your account with which you can make new transactions. Free margin is actually the difference between assets and margin.
- Margin level : a percentage of the value based on the available and usable margin compared to the used margin.
- Open trades : This section shows your current active trades.
- Closed trades : These are trades that have ended and are no longer valid.
- Deposit /Withdrawal : Any money you have deposited or withdrawn from your account.
- Profit /Loss : This section also shows your total profit or loss.
An example of a statement in forex
Now let’s understand the concept of statement better with an example.
Suppose you open a new user account on the platform of a forex broker and you make two transactions with it:
First trade: You buy one lot of the EUR/USD currency pair at a quote of 1.2000 and sell it at 1.2050, thus making a profit on the trade.
Second trade: You buy one lot of the USD/JPY currency pair at 110.00 and sell it at 109.50, thus making a loss on this trade.
After completing the trades, if you refer to the statement section on the platform, you will see that the two trades you made are in their own section, under the title of closed trades, and the amount of profit and loss from each, as well as Your total final balance is also listed in its respective sections.
Frequently asked questions
1. What is a statement in forex?
A forex statement is like a statement that shows a record of all trading activity, profit/loss, deposits and withdrawals in a forex trading account over a specific period of time.
2. How often do forex brokers provide statements?
Most forex brokers provide monthly statements that summarize the previous month’s activity. Some brokers may also offer weekly or daily statements. These statements may be provided electronically through the trading platform or email.
3. What information is usually included in a forex statement?
Standard information includes account balance, all trades completed including details such as date/time, currency pairs, trade size, exchange rate, profit or loss, commission, deposits and withdrawals, account fees and interest paid or earned.
4. Why are statements important to forex traders?
The statement helps traders evaluate their performance, track profit/loss for tax purposes, analyze which currency pairs or strategies are performing better, adjust position size and risk management as needed, and any discrepancies in Check the trades or fees applied by the broker.
5. How can traders use Forex statements to improve trading performance?
You can compare the statement in different time frames to identify your successful trading habits or mistakes. This analysis can help you make changes or modifications to your trading plan and strategy in the future. The statement also helps assess the impact of sentiment, discipline and psychology on profitability.
