Trading Jobs Forex Trader Training 3 — Questions and Answers
Question 1: What is a 'pip value' used to calculate?
- The monetary gain or loss per pip move (Correct answer)
- The broker's commission rate
- The maximum leverage allowed
- The currency's interest rate
Correct answer: The monetary gain or loss per pip move
Pip value converts a price movement in pips into the actual profit or loss in account currency.
Question 2: Which order type executes immediately at the current market price?
- Market order (Correct answer)
- Limit order
- Stop order
- Trailing order
Correct answer: Market order
A market order fills right away at the best available current price.
Question 3: What does a positive 'swap' or rollover indicate?
- You earn interest for holding the position overnight (Correct answer)
- You pay a penalty for closing early
- Your leverage was reduced
- The spread widened
Correct answer: You earn interest for holding the position overnight
A positive swap credits interest when the held currency has a higher rate than the borrowed one.
Question 4: Risk management commonly limits risk per trade to about what?
- 1–2% of account equity (Correct answer)
- 20–30% of account equity
- 100% of account equity
- Exactly 50% always
Correct answer: 1–2% of account equity
Professional traders typically risk only 1–2% of equity per trade to survive losing streaks.
Question 5: A 'lot' of 100,000 units of the base currency is called what?
- Standard lot (Correct answer)
- Mini lot
- Micro lot
- Nano lot
Correct answer: Standard lot
A standard lot equals 100,000 units; mini is 10,000 and micro is 1,000.
Question 6: What is a 'margin call'?
- A demand to add funds when equity falls below required margin (Correct answer)
- An order to take profit
- A bonus from the broker
- A scheduled economic report
Correct answer: A demand to add funds when equity falls below required margin
A margin call occurs when losses reduce equity below the minimum margin, requiring more funds or position closure.
Question 7: Which pair is considered a 'major' forex pair?
- EUR/USD (Correct answer)
- TRY/ZAR
- MXN/SGD
- NOK/HUF
Correct answer: EUR/USD
Majors always include the US dollar paired with another large economy currency like the euro.
Trading Jobs Forex Trader Training 3
What is a 'pip value' used to calculate?