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Forex Math Rules

  • #41
  • May 29, 2017 11:36pm May 29, 2017 11:36pm
Once you have the above (good stuff!) math under your belt,
try to design a MS Excel worksheet to show your Profit/Loss.

It's a very complicated and time consuming exercise,
but it will help you really understand the math involved!

Also gives you a feel of margin call risks too,
which is extremely important!
  • #42
  • May 30, 2017 1:48am May 30, 2017 1:48am
No need for excel sheet
excel sheet for "market kids" or newbies
Forex Philosopher
  • #43
  • May 30, 2017 1:58am May 30, 2017 1:58am
Quoting VEEFX
{quote} could you please explain "profit percentage accumulative multiplier" = ?
yes,
y=ax+b, it looks as a linear equation,
but in fact according to definition, it should be a parabolic,
your progress is linear, but your balance is parabolic due to that linearity.

the term ax, you may considered it a variable multiplied by another variable.
a you may considered it an accelerator.
Attached Image
Forex Philosopher
  • #44
  • May 30, 2017 5:22pm May 30, 2017 5:22pm
simply assume we have 100USD as a starting balance,
if profit % each time is steady at 10% for each interval,
calculate for mew balance for n intervals:
y=1.1^n*b
interval 0: y0=100USD
interval 1: y1=110USD
interval 2: y2=121USD
and so on,

but we need equauin to be in the form: y=ax+b
what should we do??
ans:
y1=110=ax+b=ax+100 ---- ax=10
y2=121=ax+b=ax+100 ---- ax=21
and so on

if x is always mapped on starting balance, it is value alwyas will be 10 USD
so a is the accumulative percentage multiplier,
y1: a=1
y2: a=2.1
and so on

interval 0: 100USD
Forex Philosopher
  • #45
  • May 30, 2017 5:56pm May 30, 2017 5:56pm
Quoting Master-Mind
simply assume we have 100USD as a starting balance, if profit % each time is steady at 10% for each interval, calculate for mew balance for n intervals: y=1.1^n*b interval 0: y0=100USD interval 1: y1=110USD interval 2: y2=121USD and so on, but we need equauin to be in the form: y=ax+b what should we do?? ans: y1=110=ax+b=ax+100 ---- ax=10 y2=121=ax+b=ax+100 ---- ax=21 and so on if x is always mapped on starting balance, it is value alwyas will be 10 USD so a is the accumulative percentage multiplier, y1: a=1 y2: a=2.1 and so on interval 0: 100USD...

How shold we use variable a, profit percentage accumulative multiplier, in practise?

Or how should we interpret it's value?
  • #46
  • May 31, 2017 2:40pm May 31, 2017 2:40pm
a itself is simply (interval percentage+1) to the power (interval numbers n)
but due to above complications, consider the elementary rule:
y=b*(1+percentage/100)^n = b*(1+p/100)^n
they are the same.
let us assume interval = one week, and each week required profit percentage is 33% and ur initia balance is 1,000 USD

then after 5 weeks:

y= b*(1+p/100)^n = 1,000*(1+33/100)^5 = 4161.58 USD
Forex Philosopher
  • #47
  • Jun 26, 2017 12:43pm Jun 26, 2017 12:43pm
Average price entry calc:

Pavg = (p1*lots+p2*lot2+p3*lot3+ . . . . ) / (lot1+lot2+lot3+ . . . )
Forex Philosopher
  • #48
  • Oct 28, 2017 8:13am Oct 28, 2017 8:13am
good study, thnks. it will be continue ?
  • #49
  • Oct 28, 2017 10:20pm Oct 28, 2017 10:20pm
Quoting kingofmicro
good study, thnks. it will be continue ?
depend on questions
u know
Forex Philosopher
  • #50
  • Oct 28, 2017 10:38pm Oct 28, 2017 10:38pm
GBPUSD now is 1.3000
NZDUSD now is 0.7000
GBPNZD now is 1.8571

what will happen to GBPNZD if:
1) GBPUSD goes up by 130 pips and NZDUSD goes up by 70 pips?
2) GBPUSD goes up by 130 pips and NZDUSD fall down by 70 pips?
3) GBPUSD fall down by 130 pips and NZDUSD goes up by 70 pips?
4) GBPUSD fall down by 130 pips and NZDUSD fall down by 70 pips?
Forex Philosopher
  • #51
  • Oct 29, 2017 12:02pm Oct 29, 2017 12:02pm
Quoting Master-Mind
GBPUSD now is 1.3000 NZDUSD now is 0.7000 GBPNZD now is 1.8571 what will happen to GBPNZD if: 1) GBPUSD goes up by 130 pips and NZDUSD goes up by 70 pips? 2) GBPUSD goes up by 130 pips and NZDUSD fall down by 70 pips? 3) GBPUSD fall down by 130 pips and NZDUSD goes up by 70 pips? 4) GBPUSD fall down by 130 pips and NZDUSD fall down by 70 pips?
Is it somehow connected with arbitrage? I think efficient market won't leave such opportunities..
  • #52
  • Edited 4:52pm Oct 29, 2017 12:25pm | Edited 4:52pm
Quoting Master-Mind
GBPUSD now is 1.3000 NZDUSD now is 0.7000 GBPNZD now is 1.8571 what will happen to GBPNZD if: 1) GBPUSD goes up by 130 pips and NZDUSD goes up by 70 pips? 2) GBPUSD goes up by 130 pips and NZDUSD fall down by 70 pips? 3) GBPUSD fall down by 130 pips and NZDUSD goes up by 70 pips? 4) GBPUSD fall down by 130 pips and NZDUSD fall down by 70 pips?
GN = 1 / (NU*(1/GU))
  • #53
  • Oct 29, 2017 12:31pm Oct 29, 2017 12:31pm
Quoting Nicholishen
{quote} GN = 1 / (NU*(1/UG))
Wrong.
  • #54
  • Oct 29, 2017 12:43pm Oct 29, 2017 12:43pm
Quoting Master-Mind
GBPUSD now is 1.3000 NZDUSD now is 0.7000 GBPNZD now is 1.8571 what will happen to GBPNZD if: 1) GBPUSD goes up by 130 pips and NZDUSD goes up by 70 pips? 2) GBPUSD goes up by 130 pips and NZDUSD fall down by 70 pips? 3) GBPUSD fall down by 130 pips and NZDUSD goes up by 70 pips? 4) GBPUSD fall down by 130 pips and NZDUSD fall down by 70 pips?

1) GBPNZD = (1.3000+0.0130) / (0.7000+0.0070) = 1.85714

The rest is alike.

Before GU and NU went up: GBPNZD = 1.3000 / 0.7000 = 1.85714, so the price for GBPNZD didn't change.
  • #55
  • Oct 29, 2017 2:40pm Oct 29, 2017 2:40pm
Interesting Math in forex... but confused
Le$$ I$ More
  • #56
  • Edited Oct 30, 2017 1:40pm Oct 29, 2017 4:50pm | Edited Oct 30, 2017 1:40pm
Quoting Botan626
{quote} 1) GBPNZD = (1.3000+0.0130) / (0.7000+0.0070) = 1.85714 The rest is alike. Before GU and NU went up: GBPNZD = 1.3000 / 0.7000 = 1.85714, so the price for GBPNZD didn't change.
C/A = 1/((A/B)(B/C))

This applies to any and all pairs
  • #57
  • Edited Oct 30, 2017 2:29am Oct 29, 2017 5:01pm | Edited Oct 30, 2017 2:29am
Quoting Nicholishen
{quote} Lol. You have no idea how pair pricing works

You must be talking about yourself.


Quoting Nicholishen
{quote} C/A = 1/((A/B)(B/C))
This formula is right.

Will assume C is GBP, A is NZD and B is USD and check it.

So 1/((NZD/USD)*(USD/GBP)) = 1/(NZD/GBP) = GBP/NZD = C/A, which is right.


Then why you said 1/UG in this post (https://www.forexfactory.com/showthread.php?p=10439040#post10439040) of yours originally? Now you edited your post quietly, but I'm sorry, I quoted (https://www.forexfactory.com/showthread.php?p=10439048#post10439048) it before and your mistake will be here forever.


You ain't man enough to admit you were wrong? Not the first time I'm catching you with your foolishness.


BTW,

1 / (NU*(1/GU)) = (GBP/USD)/(NZD/USD) = GBP/NZD, which I applied here (https://www.forexfactory.com/showthread.php?p=10439073#post10439073). You've got anything else to say?
  • #58
  • Oct 29, 2017 8:41pm Oct 29, 2017 8:41pm
Quoting Botan626
{quote} You must be talking about yourself. {quote} This formula is right. Will assume C is GBP, A is NZD and B is USD and check it. So 1/((NZD/USD)*(USD/GBP)) = 1/(NZD/GBP) = GBP/NZD = C/A, which is right. Then why you said 1/UG in this post (https://www.forexfactory.com/showthread.php?p=10439040#post10439040) of yours originally? Now you edited your post quietly, but I'm sorry, I quoted (https://www.forexfactory.com/showthread.php?p=10439048#post10439048) it and your mistake will be here forever. You ain't man enough to admit...
Yes, I corrected a typo, which should have been implicit since there is no UG pair in forex. We are both right, you are using the simplified equation, but doesn't universally apply to all currency rings, and for the sake of consistency we should refer to the equation that universally applies to all situations and not the simplification of one example. C/A = 1/((A/B)(B/C))
  • #59
  • Edited Oct 31, 2017 2:08am Oct 30, 2017 4:23am | Edited Oct 31, 2017 2:08am
Quoting Nicholishen
{quote} Yes, I corrected a typo, which should have been implicit since there is no UG pair in forex. We are both right, you are using the simplified equation, but doesn't universally apply to all currency rings, and for the sake of consistency we should refer to the equation that universally applies to all situations and not the simplification of one example. C/A = 1/((A/B)(B/C))

Such a BULLSHIT all of this!


1) You say you corrected an implicit typo, just because there is no USDGBP pair in forex? The lack of USDGBPin the Market Watch allows you to say it

was an implicit typo? Are you nuts? You made a mistake in the complicated formula which needs further simplification, you didn't check it and now you trying

to excuse yourself in the very clumsy way by inventing stupid reasons, saying it was something implicit? I won't buy it. Fool somebody else.


2) C/A = 1/((A/B)(B/C))

Where the hell did you find this formula and why the hell do you say it's universal?

Do you understand that 1/((A/B)(B/C)) = (C/B)/(B/A)?

And C/A = (C/B)/(B/A), if C/B and B/A are the form of the pairs in the Market Watch, applies in the most situations, instead of the pairs with CAD standing in the 1st place (like CADCHF and CADJPY) and NZD standing in the 2nd place (like EURNZD and GBPNZD).

More of this, if the one wants to get, e.g., EURCAD using your damn universal formula, he needs to do the following:

1 / ((CAD/USD)/(USD/EUR)) = 1 / (CAD/EUR) = EUR/CAD.

Both CAD/USD and USD/EUR are NOT in the Market Watch, so to be god damn universal your equation should be like this: C/A = 1 / ((1/(A/B))*(1/(B/C))).

So your equation is not universal in any way.


3)
Quoting Nicholishen
{quote}We are both right...
Why change of mind all of a sudden? Just yesterday you said (https://www.forexfactory.com/showthread.php?p=10439458#post10439458) I "have no idea how pair pricing works". Nothing did change in what I was saying, I was right from the beginning.

So what, you were wrong again in judging me? Yes? No balls to admit it and say it clearly and say you are sorry?

Same was happening between us when I was seaking for the help re Heiken Ashi candles, you gave me almost 10 different wrong or irrelevant answers, until I found the right one by myself and pointed it out into you, saying you were feeding me with shit and wasted a lot of my time and energy. And you put me on ignore list after this!


What a dumbass you are.
  • #60
  • Nov 3, 2017 6:59am Nov 3, 2017 6:59am
Quoting Nicholishen
{quote} GN = 1 / (NU*(1/GU))
let me check:
1/(NU*(1/GU) = GU/NU=(G/N)*(U/UG/N=GN

FROM BEGINNING
gbpnzd always equal to GBPUSD/NZDUSD

SO EXTREME CASE OPPOSITE DIRECTION

2) GBPUSD goes up by 130 pips and NZDUSD fall down by 70 pips?
3) GBPUSD fall down by 130 pips and NZDUSD goes up by 70 pips?


LIKE WGAR HAPPEN S YESTERDAY

Forex Philosopher
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