Forex trading education - Take-Profit Order
A "take profit" order is intended for a scenario in which a transaction is profitable and the changes in the exchange rate are reflected increased profits. If a client is not interested in constrantly following the transaction but is rather interested in getting out of the market at a predetenrmined profit, all the client has to do is a take-profit at an exchange rate which is higher than the purchase rate, or rather, determine a monetary amount at which he/she would like to exit the transaction.
For example - We have bought Euros at a particular exchange rate and we placed a take-profit order at 100 pips above the exchange rate of purchase. We know that in this specific transaction we can only profit a maximum of 100 pips.
These two orders do not entail any payment of commission: They can be placed at the beginning of the transaction, be changed in the course of the exchange, be moved or removed, as long as they haven't been executed. It is important to note that there are brokers who allow you to place the order only after the transaction has been opened. On the other hand, there are brokers who allow you to place these orders at the beginning of the transaction, it is all subject to the firm policies.
Whats Next?
* Future order - limit
Or go back to the education index
For example - We have bought Euros at a particular exchange rate and we placed a take-profit order at 100 pips above the exchange rate of purchase. We know that in this specific transaction we can only profit a maximum of 100 pips.
These two orders do not entail any payment of commission: They can be placed at the beginning of the transaction, be changed in the course of the exchange, be moved or removed, as long as they haven't been executed. It is important to note that there are brokers who allow you to place the order only after the transaction has been opened. On the other hand, there are brokers who allow you to place these orders at the beginning of the transaction, it is all subject to the firm policies.
Whats Next?
* Future order - limit
Or go back to the education index
