When trading equities, the return of a position is calculated with the following formulas:
Return = Current investment - Initial investment
Return = (Current price - Average price) * Quantity
When dealing with instruments that have a different currency than the account currency, the FX exchange rate comes into play and affects the calculation of your result:
Result = (Current price / Current FX rate - Average price / Average FX rate) * Quantity
📄 Note
Return = Gain/Loss + FX impact
All percentages are calculated in comparison to your initial investment. As the Gain/Loss tab takes into account the current FX rate, the percentage may exceed 100%. However, that is only used in order to visualize the impact of FX movements.
Here are the formulas:
Gain/Loss = (Current price - Average price) * Shares / Current FX rate
Current FX rate = Current Sell price in the instrument currency / (Investment / Number of shares)
💡 Example
You’re trading 0.119462 shares of an instrument that has a current price of 64.4363 GBP, an average price of 60.7725 GBP, and a current FX rate of ~ 0.9345.
(64.4363 - 60.7725) *0.119462 / 0.9345 =0.4683
The current FX rate for the example has been calculated as follows:
64.3812 GBP / (8.23 USD / 0.119462) = 0.9345