Pip

A pip (often said to stand for "percentage in point" or "price interest point") is how forex traders measure movement. For most currency pairs it is the fourth decimal place, 0.0001. For pairs where the yen is the quote currency, such as USD/JPY, it is the second decimal place, 0.01. Most brokers quote one extra decimal, a pipette, which is a tenth of a pip.

If EUR/USD moves from 1.0850 to 1.0875, it has moved 25 pips. If USD/JPY moves from 150.20 to 150.65, it has moved 45 pips.

What a pip is worth

The money value of a pip depends on position size and the quote currency:

Pip value = pip size times position size, in the quote currency.

• 1 standard lot (100,000) of EUR/USD: 0.0001 times 100,000 = 10 dollars per pip.
• 1 mini lot (10,000): 1 dollar per pip. 1 micro lot (1,000): 0.10 dollars.
• 1 standard lot of USD/JPY: 0.01 times 100,000 = 1,000 yen per pip, which at 150 yen per dollar is about 6.67 dollars.

If your account is in euros or pounds, the value is converted at the current rate, so it changes slightly as exchange rates move. The pip value calculator does the conversion for any pair and account currency.

Common misconception

A pip is not a fixed amount of money, and "50 pips" means very different things on a micro lot and a standard lot. It also means different things on different instruments: gold, indices and crypto CFDs each have their own conventions, and brokers define "pip" or "point" differently for them, so check the contract specification.

Our guide what is a pip has more worked examples.