# Forex Compounding Calculator

**Disclaimer:** Whilst every effort has been made in building this tool, we are not to be held
liable for any damages or monetary losses arising out of or in connection with the use of it. Full disclaimer.
This tool is here purely as a service to you, please use it at your own risk.

## Calculating forex earnings

To calculate the profits from your forex trading, we enter your starting balance, percentage and number of months into the compound interest formula. The calculation returns a compounded projection figure for future earnings, to guide you as to what profits you might see from your foreign exchange trading.

## What is forex trading?

Forex trading involves buying and selling currencies in the foreign exchange market, a decentralized global market for currency trading. The last decade has seen a rise of online currency trading platforms, helping individuals trade currencies with the aim of trying to make a profit.

## Multiple currency options

Whether the base currency for your trading is US dollar, UK pound, Euro or any other currency, you'll find our forex compounding calculator works for you. If you're trading in cryptocurrency or any currency whose symbol isn't represented, simply select the blank square in the currency options.

## Example forex compound calculation

Let's say that you begin your forex currency trading with a balance of $2,000 and you're looking for a projected profit of 5% per month. To calculate a projection for earnings after 12 months, your calculation might look like this:

**Principal (P)**= 2000**Rate as decimal (r)**= 5/100 = 0.05**Time in months (t)**= 12

**Adding these into our compounding formula:**

A = P(1+r)^{t}

A = 2000 × (1+0.05)^{12}

A = 2000 × 1.7958563260221

A = 3591.7126520443

A = $3,591.71

To get a figure for profits or earnings, we deduct the principal amount ($2000) from our calculation result. This means that the compounded profit/earnings projection for your forex trading works out to be $1591.71.