How to Calculate and Interpret Pips Value When Standard Lots Explained
How to Calculate and Interpret Pips Value Movement When Standard Lots
In trading the pip is the fourth decimal point in the forex price quote - e.g. a EUR/USD quote of 1.3000 if it moves to 1.3001 this is a movement of 1 pip.
Currency pair pip movement in forex trading is calculated using pips, when trading one Standard lot the pip movement is equivalent to $10 like shown on the illustrations revealed below:
How to Calculate the Pip value in a Standard Trade Account
To calculate the pip value movement when trading Standard lots a trader will count the number of pips that a forex currency pair has moved & multiply this number with $1. $10 is the pip value when trading Standard contracts.
1 pip is the smallest currency pair movement that is used when trading the forex currencies.
1 pip move when trading Standard lots is equal to $10 (100,000 units of currency * 0.0001 = $10)
How to Calculate the Pip Value Movement
Forex Example 1: if EURUSD moves from 1.3000 to 1.3001 this is equal to one pip - one pip is the 4th decimal place in the currency quote.
The pip size movement will be:
1.3001 - 1.3000 = 1 pip
1 pip* $10 per 1 pip = $10
Hence, 1 pip value movement for Standard lot is equal to $10 dollars
FX Example 2: for Example if EURUSD moves from 1.3000 to 1.3020 this is equivalent to 20 pips - one pip is the 4th decimal place in the forex quote.
The pip value movement will be:
1.3020 - 1.3000 = 20 pips
20 pip* $10 per pip = $200
Therefore, 20 pips value movement for Standard lot is equivalent to $200 dollars
FX Example 3: for Example if EURUSD moves from 1.3000 to 1.3030 this is equal to 30 pips - 1 pip is the fourth decimal place in the currency quote.
The pip size movement will be:
1.3030 - 1.3000 = 30 pips
30 pip* $10 per pip = $300
Hence, 100 pips value movement for Standard lot is equal to $1000 dollars
How to calculate Pip Value Movement When Standard Lots.
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