Trade EUR/CZK
Trade EUR/CZK with Sweden's only STP forex broker.
Speculate on the dynamic European economy by trading the euro against the Czech koruna. Start trading EUR vs CZK with by opening forex trading account from Scandinavian Capital Markets.
- Trade on MT4, MT5 and cTrader
- 13.7 pips average spread
- Earn positive swap on short positions
EUR/CZK contract specifications
Check the contract specifications for trading EUR/CZK Scandinavian Markets.
| A | B |
|---|---|
| Instrument | Euro vs Czech koruna |
| Base currency | EUR |
| Quote currency | CZK |
| Point value | 1 CZK |
| Contract (Lot) size | 100,000 EUR |
| Minimum order size | 1,000 EUR (0.01) |
| Leverage/margin requirements | 1:20 (5%) |
| Commission | $7 per lot |
| Tripple rollover | Wednesday |
| Swap long (points) | -32.449 |
| Swap short (points) | 9.176 |
| Trading session | Sunday to Friday from 21:05 to 20:55 |
When you trade EUR/CZK, the base asset is euros, and the quote asset is Czech koruna. The contract size, which is often referred to as the lot size, is 100,000 euros. The smallest order size that can be placed is 1,000 euros, also referred to as 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 EUR/CZK; the second smallest order you can create is for 2,000.
EUR/CZK is quoted with four digits. The third digit is known as the pip, and the fourth digit is known as a point. The value of a pip depends on the size of the contract. If the contract is 1 lot, the pip value will be Kč 100. If the contract size were 0.01 Lots, the Pip value would be Kč 1.
The minimum margin requirement to open 1 lot of EUR/CZK is 5%, meaning you’d need €5,000 or the equivalent amount in your trading account to open the position. To open a 0.01 lot position of EUR/CZK, you’d need €50 of margin.
Currency profiles
Euro
The euro (EUR) is the official currency of the European Union and one of the most widely traded currencies in the world. It is used by 20 of the 27 member countries of the EU, and it is the second most traded currency after the US dollar. The most recent country to adopt the euro was Croatia. The currency was established in 1999 and is divided into 100 cents.
As of 2022, it is the world's second-most traded currency after the US dollar and is used daily by over 341 million people in 20 of the 27 EU member states. The euro is issued and managed by the European Central Bank (ECB), actively traded on the international foreign exchange markets, and is a popular currency for international investors.
Czech koruna
The Czech koruna (CZK) is the official currency of the Czech Republic. It has been the official currency since 1993, following the dissolution of Czechoslovakia and the formation of two independent countries, the Czech Republic and Slovakia. The koruna is divided into 100 hellers; however, the smallest denomination coin circulating is 1 koruna.
The Czech Republic joined the European Union in 2004. However, due to strong opposition, the country has not adopted the euro and has no plans to adopt the euro in the future. The Czech National Bank (CNB) is responsible for issuing and managing the currency. In 2013, the Czech National Bank pegged the Czech koruna to the euro. Between 2013 and 2017, the EUR/CZK rate was approximately 27. In 2017, the CNB dropped the peg, and the Czech koruna continued to appreciate against the euro.
Fundamentals
- 20 countries use the euro. Croatia was the latest country to adopt the euro, joining the Eurozone on January 1st, 2023.
- When the Czech Republic joined the European Union in 2004, the EUR/CZK rate was 32.3.
- In February 2023, the Czech koruna reached its strongest value since 2008.
- In 2022, the average daily trading volume of the euro was US$2.29 trillion, while the average daily volume of the koruna was $29 billion.
- In 2022, 31% of all foreign exchange transactions involved the euro, while less than 1% included the Czech koruna.
- As of October 2022, the market cap of the Prague stock exchange was approximately US$27.6 billion. At the same time, the market cap of all Euro-zone stock exchanges was over US$20 trillion.
How to trade EUR/CZK
When you go long EUR/CZK, you’re technically buying euros with Czech korunas, expecting the euro to appreciate and the koruna to depreciate. When you go short EUR/CZK, you’re technically selling euros to buy CZK, expecting the koruna to appreciate. When you close the trade, your profit or loss will be calculated in CZK.
Example of a long (buy) EUR/CZK 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 EUR/CZK. 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 EUR/CZK margin calculation in GBP trading account
Costs to trade EUR/CZK
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 $10 per lot (100,000 EUR). Once adjusted according to the trade size of 0.01 lots (1,000 EUR), the commission becomes $0.05 to open and 0.05 to close. If the USD/CZK exchange rate is 22, the total commission is CZK 2.2.
Example of how commissions affect profit and loss
Swaps
A swap is a fee for holding positions overnight. The price is derived from the interest rate differential of the base and quote currencies and varies depending on whether your position is long or short. In this example, the swap rate for a long EUR/CZK position is -4.5 pips, and 1.7 pips for a short position.
Example of how overnight swaps affect profit and loss
Ready to trade EUR/CZK?
Speculate on the rising and falling price of the euro against the Czech koruna by joining Scandinavian Capital Markets. Start with a demo account or test our conditions with a live free trial.
Many ways to trade EUR/CZK
MetaTrader 5
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