What is a pip, and how much is it worth?

When EUR/USD moves from 1.0850 to 1.0851, it has moved one pip. A pip is how forex traders measure price moves, the same way you'd say a stock moved "one dollar."

Where the pip is

For most pairs, a pip is the 4th decimal place (0.0001). For pairs with the Japanese yen, like USD/JPY, it's the 2nd decimal place (0.01), because yen prices are much bigger numbers.

• EUR/USD 1.0850 → 1.0875 = 25 pips
• USD/JPY 150.20 → 150.50 = 30 pips

Many brokers show one extra digit (1.08503). That last small digit is a pipette, one-tenth of a pip.

How much is a pip worth?

It depends on how big your trade is. Trade sizes are measured in lots:

• 1 standard lot = 100,000 units
• 1 mini lot (0.10) = 10,000 units
• 1 micro lot (0.01) = 1,000 units

For any pair ending in USD (EUR/USD, GBP/USD, AUD/USD), one pip is worth about $10 per standard lot, $1 per mini lot and $0.10 per micro lot. For other pairs, the value changes slightly with the exchange rate.

Worked example

You buy 0.20 lots of EUR/USD. Price rises 30 pips. Each pip is worth $10 × 0.20 = $2, so you made 30 × $2 = $60. If it had fallen 30 pips instead, you'd have lost $60.

Work out pip values for any pair with the calculator →

For learning only, not financial advice. Trading on margin is high risk.