How to Calculate Trading Profit

Before placing a trade, it's crucial to define your risk level and set a realistic profit target. Understanding your potential gains or losses in advance helps you plan your trades effectively and manage risk wisely.

Our Trading Profit Calculator allows you to do just that—quickly estimating potential profits or losses based on your trade details. Whether you’re trading Forex, stocks, or cryptocurrency, this tool helps you make informed decisions and refine your strategy.

What You’ll Learn in This Guide

• How a trading profit calculator works
• What factors impact profit and loss calculations
• How to use a calculator for Forex, stocks, and crypto trading
• Risk management tips to maximise profits and minimise losses

What is Profit in Trading?

In trading, profit is the difference between the entry and exit price of a trade. Your gain or loss depends on whether you bought or sold the asset and how its price changed over time.

How Profit & Loss Work

For a buy (long) position:

Profit = Selling price − Buying price

Loss = Buying price − Selling price

For a sell (short) position:

Profit = Buying price − Selling price

Loss = Selling price − Buying price

How to calculate trading profit?

• You buy GBP/USD at 1.2500 and later sell at 1.2550 → You made 50 PIPs of profit.
• You short GBP/USD at 1.2500 and later buy back at 1.2550 → You lost 50 PIPs.

Your total profit or loss depends on your trade size (lot size) and leverage.

Why Use a Trading Profit Calculator?

Most trading platforms automatically display your profit or loss when a position is closed, but a trading profit calculator helps you estimate potential outcomes before entering a trade.

Using a profit calculator allows you to:

• Plan trades more effectively by knowing potential profits or losses upfront.
• Adjust your risk management strategy based on expected returns.
• Compare different trading scenarios before making a decision.

This tool is especially useful for Forex and crypto traders, where market volatility can quickly impact profits.

How Does a Trading Profit Calculator Work?

Our Trading Profit and Loss Calculator determines how much you can gain or lose based on the opening and closing prices of your trade.

To use the calculator, enter the following details:

• Trading instrument – Forex pair, stock, commodity, or cryptocurrency
• Deposit currency – The currency of your trading account (GBP, USD, EUR, etc.)
• Trade direction – Buy (long) or Sell (short)
• Lot size or investment amount – Position size (e.g., standard, mini, or micro lots)
• Opening price – The price at which the position was opened
• Closing price – The price at which the position is closed (or stop-loss/take-profit level)

Profit Calculation Formula:

Profit = (Lot size × Opening price) − (Lot size × Closing price) 

Keep in mind that real trading profits may also be affected by:

• Broker commissions
• Swap fees (overnight charges for holding trades)
• Spreads (the difference between the bid and ask price)

How to Use a Forex Trading Profit Calculator

For Forex traders, a profit calculator helps determine how much you can earn or lose based on exchange rate movements.

Key Inputs for Forex Profit Calculation:

• Currency pair (e.g., GBP/USD, EUR/USD)
• Account currency (GBP, EUR, USD, etc.)
• Trade size (standard lot, mini lot, or micro lot)
• Opening and closing price
• Trade direction (Buy/Sell)

For example

You buy 1 standard lot (100,000 units) of GBP/USD at 1.1500 and later sell at 1.1550, gaining 50 PIPs.

(0.0001 × 100,000) × 50 = £500 profit

If you trade with leverage, your capital invested is lower, but the profit/loss is amplified. Before placing a trade, always check if your potential reward justifies the risk.

How to Use a Crypto Trading Profit Calculator

A crypto profit calculator helps traders estimate potential gains and losses when buying or selling Bitcoin, Ethereum, or other cryptocurrencies.

For example

You buy 1 Bitcoin (BTC) at £30,000 and later sell at £32,000.

Profit = £32,000 − £30,000 = £2,000

If you use 5x leverage, your profit would be: £2,000 × 5 = £10,000

A crypto profit calculator allows you to test different price scenarios before trading, ensuring you make well-informed decisions.

Other Trading Calculators You Should Know About

Lot Size Calculator

A lot size calculator helps determine the optimal position size based on your account balance and risk tolerance.

Why it’s useful:

• Helps control risk per trade
• Prevents overleveraging
• Ensures consistent money management

Position Size Calculator

A position size calculator determines how much capital to allocate to a trade based on your risk management rules.

Example:

• You have a £10,000 trading account and want to risk 2% per trade.
• Your risk per trade = £200.
• Your lot size should be adjusted accordingly to stay within this risk limit.

By using a profit calculator alongside a position size calculator, you can ensure that your trades are both profitable and risk-controlled.

Whether you're trading Forex, stocks, or cryptocurrencies, understanding how much you stand to gain or lose per trade is essential for long-term success.

Expert advice

• Always calculate your potential profit and loss before placing a trade.
• Use a profit calculator to refine your trading strategy.
• Combine it with a position size calculator to ensure proper risk management.

To get started, try our free Trading Profit Calculator today and take control of your trades.

How much profit is 20 pips?

The profit from 20 PIPs depends on three key factors:

• Currency Pair – Different currency pairs have different PIP values.
• Lot Size – The number of units you trade affects how much each PIP is worth.
• Account Currency – If your account is in GBP, but you're trading a pair like EUR/USD, you may need to convert profits.

How to Calculate Profit from 20 PIPs

Profit = PIP Value × Number of PIPs

PIP Value by Lot Size (For GBP/USD & Major Pairs)

Scenario 1: Trading GBP/USD with a Standard Lot (100,000 units)

• You buy GBP/USD at 1.2500 and sell at 1.2520 (a 20-PIP movement).
• Profit = 20 PIPs × £10 per PIP = £200.

Scenario 2: Trading GBP/USD with a Mini Lot (10,000 units)

• You sell GBP/USD at 1.3000 and buy back at 1.2980.
• Profit = 20 PIPs × £1 per PIP = £20.

Scenario 3: Trading EUR/GBP (PIP Value Varies)

For EUR/GBP, the PIP value isn’t always £10 for a standard lot, as the PIP value is calculated in GBP per EUR movement. To find the exact PIP value, check your broker’s platform or a PIP calculator.

Nishadh Mohammed

Nishadh Mohammed is a seasoned news editor and financial writer, working with HelloSafe since May 2023. Nishadh has developed expertise in financial markets, insurance, and investment products, with a deep understanding of the Canadian financial landscape. He has honed his SEO skills and content marketing strategies while writing for Canadian publishing houses. Armed with a master's in Business Analytics and extensive journalistic experience, Nishadh uniquely combines data proficiency and thorough research to deliver comprehensive and accessible information.