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Basics

Pip value — definition & meaning

How much money one pip of movement is worth for your position.

Pip value is the money gained or lost per pip, based on your lot size and the pair. On a standard lot of most USD-quoted pairs, one pip is about $10; on a micro lot, about $0.10.

Knowing pip value lets you translate a stop distance in pips into real money, which is the heart of position sizing.

The information on Trding.io is for general information only and is not investment advice. Trading involves a real risk of losing money, and most retail traders lose. Never trade money you cannot afford to lose.

Related terms

Pip
The smallest standard price move in most currency pairs.
Lot
A standard trade size unit; in forex one standard lot is 100,000 units.
Position sizing
Choosing how large a trade to place based on your risk per trade.
Spread cost
The actual money the bid-ask spread costs you on a trade.
Long
Buying an asset expecting its price to rise so you can sell higher.
Short
Selling an asset you expect to fall, aiming to buy it back cheaper.

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