Forex Trading Examples. The key principle of forex trading is simple. You buy one currency with another currency at the present exchange rate, so you are in effect going long of the first currency and short of the second currency.

To help you understand how forex trading works, view our CFD examples below, which take you through both buying and selling scenarios. CFD trading example 1: buying EUR/GBP. EUR/GBP is trading at 0.84950 / 0.84960. You decide to buy €50,000 because you think the price of EUR/GBP will go up. EUR/GBP has a …

In the example above you have purchased A$100,000. But because FX is traded on margin with CMC Markets you will only need A$1,000 (1%) to maintain the same market exposure. The risk on this AUD/USD trade is equivalent to US$10 per each point movement. Each point is valued at 0.0001.