How pip value is calculated
Pip value is the money one pip of price movement makes or loses on your position. It starts in the pair's quote currency (the second currency in the pair) and is then converted into your account currency:
Pip value (quote currency) = pip size × contract size × lots
Pip value (account currency) = pip value in quote currency converted at the current rate
Pip sizes and contract sizes
| Instrument | One pip | One standard lot | Pip value per lot |
|---|---|---|---|
| EUR/USD, GBP/USD, AUD/USD, NZD/USD | 0.0001 | 100,000 units | $10.00 |
| USD/JPY and other yen pairs | 0.01 | 100,000 units | ¥1,000, converted to your currency |
| EUR/GBP and other crosses | 0.0001 | 100,000 units | 10 units of the quote currency |
| XAU/USD (gold) | 0.10 | 100 oz | $10.00 |
| XAG/USD (silver) | 0.01 | 5,000 oz | $50.00 |
Worked examples
- EUR/USD, 1 lot, USD account: 0.0001 × 100,000 = $10 per pip, with no conversion because USD is the quote currency.
- USD/JPY, 1 lot, USD account: 0.01 × 100,000 = ¥1,000 per pip. At a USD/JPY rate of 150.00 that is ¥1,000 ÷ 150 = about $6.67.
- EUR/USD, 0.25 lots, EUR account: $2.50 per pip, which at a EUR/USD rate of 1.1000 is €2.27.
Why pip value matters
Pip value turns a stop loss in pips into money. A 30-pip stop on one lot of EUR/USD risks $300, while the same 30 pips on one lot of gold risks $300 too, but gold often moves 30 pips in minutes. Knowing the pip value lets you compare instruments fairly and size trades with the position size calculator.