What is 1 lot of gold equal to, and other important indicators when trading on the stock exchange?
For thousands of years, gold has been one of the most popular assets; the precious metal is widely used for investment and as a guarantee of currency security.
In everyday life, we are accustomed to the fact that the measure of weight of precious metal is grams, kilograms and tons.
But on the exchange, the weight of gold is measured in troy ounces and standard lots; these are the units of measurement used in quotes and exchange transactions.
What is one troy ounce and how is it calculated? - https://time-forex.com/info/troy-ounce
To trade gold professionally, you need to know concepts such as quote, lot, point, spread, and swap.
Knowing that one troy ounce is equal to 31.1034768 grams, one can easily calculate that 1 lot of gold will be:
31.1034768 x 100 = 3110.34768 or 3.11034768 kilograms
In addition, the asset specification above specifies the minimum transaction size, which is 0.01 lots or 1% of 1 lot of gold.
Quote – displays the current price of the precious metal, consists of two symbols.
The first place indicates the precious metal XAU itself, and the second place indicates the currency in which its value is expressed (USD, EUR, GBP, etc.):
The quote itself will look like this: XAU/USD is the price in US dollars, XAU/EUR is the price in euros, and XAU/GBP is the price in British pounds. The current gold quote is https://time-forex.com/kotirovki
Typically, a precious metal quote has two decimal places, with the last decimal place in the XAU/USD quote indicating the price change in points.
That is, at the current price of 1811.0 5 US dollars per 1 ounce, a change of +1 point will mean an increase in the price in the quote to 1811.0 6 US dollars per ounce.
Spread is a commission charged when opening a trade on a precious metal; it is the difference between the Bid and Ask prices:
The spread is debited in any case, regardless of whether you open a buy or sell transaction.
When trading on the exchange, the commission rate is much lower than if you were to sell and buy gold in real life; on average, the spread at a brokerage company is no more than 0.02%.
Swap is a fee for carrying a trade over to the next day, charged if you do not close the trade before 24:00 hours of the opening date.
The swap size for XAU/USD is approximately 0.3% per month of the open position volume and depends on the direction of the transaction.
Exchange trading of gold is carried out using a special program, a trading platform, where transactions of a specified volume in lots are opened.
Before starting work, you need to open an account with one of the brokers - https://time-forex.com/spisok-brokerov
