Pip

What Is a Pip?

A pip (percentage in point) is the standard unit used to measure price changes in forex. For most currency pairs, a pip is the fourth decimal place (0.0001). For pairs involving the Japanese yen, a pip is the second decimal place (0.01), because JPY pairs are quoted with two decimal places instead of four.

For example, if EUR/USD moves from 1.0850 to 1.0851, that is a 1-pip increase. If USD/JPY moves from 149.50 to 149.51, that is also a 1-pip increase.

How to Calculate Pip Value

The monetary value of a pip depends on three factors: the currency pair, the Lot size, and the account currency. For a standard lot (100,000 units) of EUR/USD, one pip equals $10. For a mini lot (10,000 units), one pip equals $1. For a micro lot (1,000 units), one pip equals $0.10.

Use our Pip Value Calculator to find the exact pip value for any pair and lot size in your account currency.

Why Pips Matter

Pips are how traders measure profit, loss, and risk. If you buy EUR/USD at 1.0850 and sell at 1.0880, you made 30 pips. Knowing the pip value for your position size lets you convert that into dollars, euros, or any other account currency. Stop-Loss and Take-Profit levels are also set in pips.