Trade AUD/CAD
Trade the Australian dollar vs the Canadian dollar with Sweden’s only STP forex broker.
Speculate on the interplay of two powerhouse commodity currencies rooted in resource-rich economies. Start trading AUD/CAD with a Scandinavian Markets forex trading account.
- Trade on MT4, MT5 and cTrader
- 0.8 pips average spread
- Up to 1:200 leverage
AUD/CAD contract specifications
Check the contract specifications for trading AUD/CAD with Scandinavian Markets.
| A | B |
|---|---|
| Instrument | Australian dollar vs the Canadian dollar |
| Base currency | AUD |
| Quote currency | CAD |
| Contract (Lot) size | 100,000 AUD |
| Minimum order size | 1,000 AUD |
| Point value | 1 CAD |
| Leverage/margin requirements | 1:200 (0.5%) |
| Commission | $7 per lot |
| Tripple rollover | Wednesday |
| Swap long (points) | -6.54 |
| Swap short (points) | -0.455 |
| Trading session | Sunday to Friday from 21:05 to 20:55 |
When you trade AUD/CAD, the base asset is the Australian dollar, and the quote asset is the Canadian dollar. The contract size, which is often referred to as the lot size, is 100,000 AUD. The smallest order size you can place is 1,000 AUD, also called a micro-lot or 0.01 lots. Orders can only be submitted in increments of 1,000. Therefore, you cannot place an order for 1,600 AUD/CAD; the second smallest order you can create is for 2,000.
AUD/CAD is quoted with five digits. The fourth digit is known as the pip, and the fifth digit is known as a point. The value of a pip depends on the position size. If the position is 1 lot, the pip value will be 10 CAD. If the contract size were 0.01 lots, the pip value would be 0.1 CAD.
The minimum margin requirement to open 1 lot of AUD/CAD is 1%, meaning you’d need 1,000 AUD or the equivalent amount in your trading account to open the position. To open a 0.01 lot position of AUD/CAD, you’d need 10 AUD of margin.
Currency profiles
Australian dollar
The Australian Dollar, commonly known as the "Aussie," is the official currency of Australia, its external territories, and several Pacific Island neighbours. Governed by the Reserve Bank of Australia, this currency often acts as a reflection of the nation's robust economy, which is anchored deeply in its vast natural resources. From the bustling mines extracting iron ore, coal, and gold to the sprawling landscapes catering to agriculture and the dynamic services sectors like finance and tourism, the Aussie is a direct beneficiary of these economic ventures.
The Australian Dollar stands tall on the global stage as a major commodity currency. Its value frequently fluctuates with the prices of raw materials, and its strong ties to the Asia-Pacific region, especially China, render it a subtle yet insightful indicator of the economic health of this crucial region. More than just a medium of exchange, the Aussie, introduced in 1966 to replace the Australian pound, embodies Australia's spirit of progress and its integral role in the world's economic tapestry.
Canadian dollar currency profile
The Canadian dollar is affectionately dubbed the "Loonie" due to the iconic loon on its one-dollar coin, which is Canada's official currency. Overseen by the Bank of Canada, the Canadian dollar is a reflection of the country's expansive and diverse economy, deeply intertwined with its abundant natural resources. From its vast oil sands and energy sectors to the rich mines extracting diamonds, gold, and potash, the Canadian economy is a force to be reckoned with, and the CAD mirrors this strength.
Beyond its borders, the Canadian Dollar holds a significant position as a primary commodity currency, with its value often mirroring global oil prices, given Canada's role as a top-tier oil exporter. Its proximity and trade relationships with the United States further influence its economic dynamics and currency value. Tracing its origins to the 1850s, the Loonie has been a constant witness to Canada's evolving economic narrative. Representing more than just monetary value, the Canadian Dollar encapsulates the nation's rich history, its global trade influence, and its resilient spirit in the face of global economic shifts.
Fundamentals
- In 2022, the average daily trading volume of the Australian dollar was US$478.5 billion, and the average daily trading volume of the Canadian dollar was US$465.7 billion.
- In February 2021, AUD/CAD came close to reaching parity.
- At the peak of the 2008 financial crisis, the Australian dollar reached its weakest level against the Canadian dollar, falling to a rate of 0.7159.
- The latest AUD interest rate decision from the Reserve Bank of Australia raised rates to 4.1%. The latest Bank of Canada interest rate decision raised rates to 5%.
- The latest unemployment rate figure in Canada was 5.5%. Meanwhile, the figure is 3.6% in Australia.
- As of October 2023, the market cap of the Toronto Stock Exchange was CA$3.8 trillion. At the same time, the market cap of the Australian Securities Exchange was AU$2.5 trillion.
How to trade AUD/CAD
When you go long AUD/CAD, you’re technically buying Australian dollars with Canadian dollars, expecting the Australian dollar to appreciate and the Canadian dollar to depreciate. When you short AUD/CAD, you’re technically selling Australian dollars to buy Canadian dollars, expecting the AUD to appreciate. When you close the trade, your profit or loss will be calculated in CAD.
Example of a long (buy) AUD/CAD trade
When you trade forex using contracts for difference (CFDs), you don’t need to own either of the currencies in the trading pair. For example, if your trading account balance is denominated in British pounds, you can still trade AUD/CAD. The purpose of a CFD is to enable traders to hold positions and speculate on the price of one currency against another without owning the underlying currency. When a position is closed, it’s always settled in cash by increasing the balance in your trading account.
Example of AUD/CAD margin calculation in GBP trading account
Costs to trade AUD/CAD
There are different costs when trading forex with Scandinavian Markets. Besides market fluctuations, three primary factors influence your trading profitability: commissions, spreads and swaps.
Spread
The spread is the difference between the bid and ask price. When you enter a long position, your order is opened using the ask price, which is the highest of the two quotes. When a long trade is closed, you are selling, which means the bid price is used, which is the lower of the two quotes. Therefore, the difference between the bid and ask price impacts your profitability.
The diagram below shows how an unprofitable position loses more and how a profitable one earns less due to the spread.
Example of how spread affects profit and loss
Commission
Commissions are charged when you open and close a trade. The currency you are charged depends on your trading platform and account balance. This example assumes the commission is $7 per lot (100,000 AUD). Once adjusted according to the trade size of 0.1 lots (10,000 AUD), the commission becomes $0.35 to open and $0.35 to close. If the CAD/USD exchange rate is 1.38, the total commission is 0.97 CAD.
Example of how commissions affect profit and loss
Swaps
A swap is a fee for holding positions past a cutoff time. Swaps are primarily influenced by the interest rate differential of the base and quote currencies. However, swap rates change daily due to continuously fluctuating exchange rates. Swap rates vary depending on whether your position is long or short. In this example, the swap rate for a long AUD/CAD position is -0.475 pips, and 0.012 pips for a short position.
Example of how overnight swaps affect profit and loss
Ready to trade AUD/CAD?
Speculate on the rising and falling price of the Australian dollar against the Canadian dollar by joining Scandinavian Capital Markets. Start with a demo account or test our conditions with a live free trial.
Many ways to trade AUD/CAD
MetaTrader 5
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