Basics

Pip

Percentage in point

A pip is the standard unit for measuring a change in a currency pair's price. For most pairs it is the fourth decimal place of the price; for pairs quoted in Japanese yen it is the second.

Also called: pips, point

Hypothetical example

Hypothetically, EUR/USD moves from 1.1000 to 1.1025: that is 25 pips. On 1 standard lot (100,000 euros), each pip is worth 10 US dollars, so the move is a $250 gain on a long position or the same loss on a short one.

Used in these guides

Basics8 min read
Pips, lots and spreads explained
How price moves are measured, how trade size turns pips into money, and what the spread costs you on every trade.
Basics8 min read
What is forex and how does it work?
How the global currency market works, how a forex trade is priced, and the risks that come with trading it.
Costs & risk8 min read
Trading costs: spread, commission and swap
What you pay to open, hold and close a trade, how each cost is calculated and where NextTrade publishes its figures.

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Risk Warning: CFDs are complex instruments and come with a high risk of losing money.

Pip

Hypothetical example

Related terms

Used in these guides

Pips, lots and spreads explained

What is forex and how does it work?

Trading costs: spread, commission and swap