Big Mac Index will show a target exchange rate for the selected currencies and the percentage deviation between the current and the target exchange rate. It is based on purchasing power parity (PPP).
The story behind the Big Mac Index
The Big Mac Index is an informal way of measuring the purchasing power parity (PPP) between two currencies.
The premise of the Big Mac Index is the existence of LOP (Eng. Law of One Price): the dollar price of a burger should not vary from country to country. Commodity prices should be the same in both countries observed, and the main role of the exchange rate is to correct any disproportion.
Exchange rates obtained by purchasing power parity balances the cost of goods and services in both countries.
Price of a Big Mac in USD * Exchange rates = Price of a Big Mac in observed country.
In one sentence, the purchasing power parity is the target exchange rate for the observed currency.
Interface Columns (see attached picture)
The following are inputs available in the application:
The application displayed on this page does not take in to consideration your individual personal circumstances and trading objectives. Therefore it should not be considered as a personal recommendation or investment advice. Past performance is not indicative of future results. There is no guarantee that the systems, trading techniques, trading methods, and/or indicators will result in profits or not result in losses.
An FXCM account is required (including free FXCM demo accounts).
FXCM is an independent legal entity and is not affiliated with Mario Jemic, http://www.addons-to-go.com/ or Indicators World. http://www.addons-to-go.com/ and Indicators World are not owned, controlled, or operated by FXCM and Mario Jemic is not an employee, agent or partner of FXCM.
*Links to third-party sites are provided for your convenience and for informational purposes only. FXCM bears no liability for the accuracy, content, or any other matter related to the external site or for that of subsequent links, and accepts no liability whatsoever for any loss or damage arising from the use of this or any other content. Such sites are not within our control and may not follow the same privacy, security, or accessibility standards as ours. Please read the linked websites’ terms and conditions.
We can customize any app to meet your trading needs. All you need to do is tell us what you’re looking for and we'll help you build the perfect trading app.