Which Currency Is Your Profit/Loss IN? | ForexGen

Although the movement today is towards all transaction eventually finishing in a profit or loss in USD, it is important to realize that your profit or loss may not actually be in USD.
As you would expect this is most obvious in the US.
Most US based traders assume they will see their balance at the end of each day in USD.
I have even spoken with some traders who are oblivious to the fact the their profit might have actually been in Japanese Yen.
Let me explain a little more. You buy (go long) USD/JPY and as such are long USD and short (sell) JPY.
You enter the trade at 116.10 and exit 116.90. You in fact made 80,000 Japanese Yen (1 contract traded) not US Dollars.