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Counter currency

Another name for the second currency in a pair, the one the price is expressed in and the one your profit or loss is first denominated in.

Dealers often say counter currency or terms currency where retail platforms say quote-currency. They mean the same thing: the currency doing the pricing. In USD/CAD the Canadian dollar is the counter currency, so the quote 1.3620 is read as Canadian dollars per US dollar.

The label matters for profit and loss. A move in the pair produces a result in the counter currency first, which is then converted into your account-currency at whatever rate the broker applies.

Example: you are long 1 standard lot of USD/CAD and the rate rises from 1.3620 to 1.3670. The gain is 100,000 x 0.0050 = CAD 500. Converted at 1.3670, that is about USD 365.76 in a dollar-denominated account.

Related: quote-currency, base-currency

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