How Many Dollars is a Standard PIP? - How to calculate Standard Account Pip Value Explained
Currency pair movement in fx is calculated using pips, when trading one Standard lot the pip movement is equivalent to $10 as displayed & shown on the trading examples below:
How to Calculate Pip value in a Standard Trading Account
To calculate profit or loss per pip in a Standard account, multiply the number of pips a forex pair has moved by $10. For Standard contracts, $10 represents the pip value.
1 pip is the smallest currency pair movement used when trading forex currencies.
A one-pip fluctuation while trading Standard lots translates to a $10 value (calculated as 100,000 currency units multiplied by 0.0001).
How to Calculate Profit and Loss in a Standard Account
Take EURUSD from 1.2000 to 1.2001. That's one pip, the fourth decimal in quotes.
The profit or loss will be:
1.2001 - 1.2000 = 1 pip
1 pip* $10 per 1 pip = $10
Hence, 1 pip movement for Standard lot/contract is equivalent to $10 dollars
If the trade transaction heads in direction of the trade transaction, the trader will make a profit of $10. If the trade transaction moves against the direction of the trade transaction, the trader will accrue a loss of $10 dollars.
For instance, if the EUR USD goes from 1.2000 to 1.2050, that's like 50 pips, and one pip is the fourth number after the dot in the forex price.
The profit or loss will be:
1.2050 - 1.2000 = 50 pips
50 pip* $10 per 1 pip = $500
Hence, 50 pips move for Standard lot/contract is equivalent to $500 dollars
If the trade goes your way, you earn $500 profit. If it goes against you, you lose $500.
For instance, if the EUR USD goes from 1.2000 to 1.2100, that is 100 pips, and one pip is the number in the 4th spot after the decimal in the forex price.
The profit or loss will be:
1.2100 - 1.2000 = 100 pips
100 pip* $10 per 1 pip = $1000
Hence, 100 pips move for Standard lot is equivalent to $1000 dollars
If the transaction moves in favor of the trade direction, a trader stands to gain $1,000. Conversely, if it moves against the trade direction, the trader will incur a $1,000 loss.
How to calculate Standard Account Pip Value & Profit and Loss in a Standard Account.
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