> For the complete documentation index, see [llms.txt](https://magnamarkets.gitbook.io/en/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://magnamarkets.gitbook.io/en/commodities/transaction-rules.md).

# Transaction Rules

## *How To Trade Commodities Profitably?* 

Commodities are traded in both directions, you can go buy (long) or sell (short). Simply put, if you think the rate will climb, you buy; if you think it will fall, you sell. If the direction is correct, you earn the spread in between.

Calculated as follows: Total profit/loss = (Ask price - Bid price) x contract units x number of lots traded ± overnight interest

Note: If you close a position on the day you open it, you do not need to pay overnight interest; the actual overnight interest is shown on the platform.

*Transaction Case One* 

Buy 1 lot of XAUUSD through the platform with 100 contract units per lot at the bid price of 1782.77 and close the position at the ask price of 1792.77 on the same day. 

Total P/L = (Ask price - Bid price) x contract units x number of lots traded ± overnight interest = (1792.77 - 1782.77) x 100 x 1 ± 0 = $1000

*Transaction Case Two*

Sell 1 lot of USOil via the platform with 1000 contract units per lot at an ask price of 73.645 and close the position at the bid price of 72.645 on the same day. 

Total P/L = (Ask price - Bid price) x contract units x number of lots traded ± overnight interest = (73.645.77-72.645) x *1000* x 1 ± 0 = $1000

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