Pip and Pip Value

Pip

The smallest price increment a currency can make. Also known as points. For example, 1 pip = 0.0001 for EUR/USD, or 0.01 for USD/JPY.

Pip Value

The value of a pip. Pip value can be fixed or variable depending on the currency pair and base currency of your account. e.g. The pip value for EURUSD is always $10 for standard lots and $1 for mini-lots. To calculate the pip value, divide 1 pip by the exchange rate and multiply it by the unit lot size to get the base currency pip value. To convert this back to your account currency, multiply it by the appropriate exchange rate. e.g. EURUSD = 0.0001 / 1.30000 * 100,000 = 7.69 Euro * 1.30000 = $10.00 pip value (fixed). USDJPY = 0.01 / 120.00 * 100,000 = $8.33 pip value (variable)