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How is Conversion P/L calculated?
When cash in a CHF-denominated account is debited after a purchase of a USD-denominated stock, changes in the USD/CHF exchange rate during the time the position is open will be contributory in determining profitability.
Listed below are the steps for calculating the "Conversion P/L" shown in Position Details:
1) Calculate the difference between the Open and the Close conversion rate;
2) Multiply the current market value of the position (in the currency of the instrument) by the difference between the 2 conversion rates.
FX Options and Contract Options, too, will display a "Currency Conversion P/L". The reason is as follows: when FX Options and Contract Options are bought or sold, option premiums are also deducted from, or added to, the cash balance, just like when a stock or bond is bought or sold on the account.
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