The gross profit on your trade is calculated as follows:
$435.25 * 100 contracts * 4 = USD $174,100
$460 * 100 contracts * 4 = USD $184,000
Gross Profit on Trade
USD $184,000 – $174,100 = $9,900
Opening the Position
Wheat_N7 is currently trading at 434.00/435.25 and you are expecting Australia’s East Coast crops to be affected by adverse weather patterns over the coming year which will result in lower than average crop yields.
You buy 100 contracts of Wheat (4 bushels per contract) at 435.25 which equals USD $174,100 (435.25 * 100 * 4).(4 bushels per contract) at 435.25 which equals USD $174,100 (435.25 * 100 * 4).
Closing the Position
1 month later, after sales results are released, the price of AAPL has increased to 170/172 and you decide to take profit by selling 100 AAPL Stock CFD contracts.
Your research surrounding weather conditions turns out to be correct. Lower crop yields this year have caused Wheat prices to increase to 460.00/462.15. You exit your position by selling your contracts at 460.
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