Settlement Currency Conversion: Reconcile Trading P&L

Identify what is being converted

Begin with the instrument's payoff specification. The quote currency, currency of a cash settlement, currency used for margin and account reporting currency need not all match. A broker may also maintain separate cash balances instead of converting every event immediately. These distinctions determine which amounts belong in a conversion worksheet.

MetaQuotes provides separate symbol currency properties, and OANDA's account-statement guidance describes conversion-related fields. These are examples of documentation to consult, not a universal account-booking policy.

Follow one amount through the ledger

Assume a hypothetical instrument produces a realized gain of 240 USD and the account reports in EUR. If the booking conversion is 0.92 EUR per USD, the converted amount is 240 × 0.92 = 220.80 EUR. If a separately recorded conversion charge is 1.20 EUR, the net credited amount in this example is 219.60 EUR.

A later indicative conversion of 0.90 EUR per USD would give 216 EUR before charges. The 4.80 EUR difference from 220.80 need not indicate a trade-calculation error; it can reflect the different conversion timestamp or basis. Reconstruct the booked event before comparing it with a current dashboard estimate.

Check rate direction with units

Write 240 USD × 0.92 EUR/USD. The USD units cancel, leaving EUR. If the available quote instead says 1.08695652 USD per EUR, divide the USD amount by that rate. Multiplying by it would increase the amount while leaving an incoherent unit expression. A reciprocal check is a quick way to catch this common mistake.

For multiple events, translate each using its documented booking rule. A +100 USD event at 0.90 EUR/USD and a −100 USD event at 0.95 EUR/USD net to zero USD but −5 EUR when converted separately. Converting the aggregate zero after the fact would miss that difference. Whether an actual broker books events this way must be established from its statement.

Build a reproducible reconciliation table

Record event identifier, instrument, event time, original amount and currency, conversion pair, rate direction, rate timestamp, destination amount and separate charge. Keep rounding precision explicit: rounding each event and rounding only the final sum can differ by small amounts. Preserve the original signed numbers instead of replacing them with an unlabeled absolute value.

Different conversion rates for credits and debits, valuation cutoffs, unsettled balances and financing events can explain remaining differences. Do not force the worksheet to match by silently changing the rate. For copied accounts, compare source and follower cash flows in a common reporting basis while retaining their original currencies. Equivalent price movements can produce different reported monetary returns when account currencies, execution prices or booking policies differ.