Forex Pip Calculator
Calculate pip values, profit/loss, and optimal position sizes for forex trading. Essential tools for risk management and trade planning.
Pip Value Calculator
Current EUR/USD rate
Pip Value (USD)
$10.00
Per pip for 100,000 units
Value Per Pip by Lot Size
Standard
$10.00
Mini
$1.00
Micro
$0.10
Pip Size for EUR/USD
0.0001 (4 decimal places)
What is a Pip?
A pip (percentage in point) is the smallest price move in a currency pair. For most pairs, it's the fourth decimal place (0.0001). For JPY pairs, it's the second decimal place (0.01). Understanding pip values is crucial for calculating potential profits, losses, and position sizing in forex trading.
Understanding Pips in Forex Trading
What is a Pip?
A pip (Percentage In Point) represents the smallest price movement in a currency pair. For most currency pairs, a pip is 0.0001 (the fourth decimal place). For pairs involving the Japanese Yen (JPY), a pip is 0.01 (the second decimal place).
Understanding pips is fundamental to forex trading as they're used to measure price movements, calculate profits and losses, and determine position sizes for proper risk management.
Pip Examples
EUR/USD: 1.1050 → 1.1051
= 1 pip movement (0.0001)
GBP/USD: 1.2650 → 1.2700
= 50 pip movement
USD/JPY: 149.50 → 150.00
= 50 pip movement (0.01 each)
Lot Sizes Explained
| Lot Type | Units | Pip Value (EUR/USD) | Best For |
|---|---|---|---|
| Standard Lot | 100,000 | $10.00 | Professional traders, large accounts |
| Mini Lot | 10,000 | $1.00 | Experienced traders, medium accounts |
| Micro Lot | 1,000 | $0.10 | Beginners, small accounts |
| Nano Lot | 100 | $0.01 | Practice, very small accounts |
Calculating Pip Value
Pip Value Formula
Pip Value = (Pip Size × Lot Size) / Exchange Rate
For USD Quote Currency (EUR/USD)
When USD is the quote currency (second currency), the pip value is straightforward. For 1 standard lot:
0.0001 × 100,000 = $10.00 per pip
For USD Base Currency (USD/JPY)
When USD is the base currency (first currency), you divide by the exchange rate:
(0.01 × 100,000) / 149.50 = $6.69 per pip
Risk Management with Position Sizing
The 1-2% Rule
Professional traders typically risk only 1-2% of their account balance on any single trade. This approach ensures that even a series of losing trades won't significantly damage your trading capital.
Example: $10,000 Account
- 1% risk = $100 maximum loss per trade
- 2% risk = $200 maximum loss per trade
Position Size Formula
Position Size = Risk Amount / (Stop Loss × Pip Value)
Example Calculation:
- Account: $10,000
- Risk: 2% = $200
- Stop Loss: 50 pips
- Pip Value: $10 (standard lot)
- Position = $200 / (50 × $10) = 0.4 lots
Common Forex Pairs by Category
Major Pairs
Most traded pairs, always include USD
- EUR/USD (Euro)
- GBP/USD (British Pound)
- USD/JPY (Japanese Yen)
- USD/CHF (Swiss Franc)
- AUD/USD (Australian Dollar)
- USD/CAD (Canadian Dollar)
- NZD/USD (New Zealand Dollar)
Cross Pairs
Major currencies without USD
- EUR/GBP
- EUR/JPY
- GBP/JPY
- EUR/CHF
- AUD/JPY
- EUR/AUD
- GBP/CHF
Exotic Pairs
Major + emerging market currency
- USD/MXN (Mexican Peso)
- USD/ZAR (South African Rand)
- USD/TRY (Turkish Lira)
- EUR/TRY
- USD/SGD (Singapore Dollar)
- USD/HKD (Hong Kong Dollar)
Frequently Asked Questions
What is a pipette?
A pipette is 1/10th of a pip (0.00001 for most pairs, 0.001 for JPY pairs). Many brokers now quote prices to 5 decimal places, allowing for more precise pricing. A pipette is also called a "point" or "fractional pip."
Why does pip value vary between pairs?
Pip value depends on the quote currency and exchange rate. When USD is the quote currency, pip value is fixed. When USD is the base currency, you must divide by the exchange rate, causing the pip value to fluctuate.
How do I calculate my profit in pips?
For a buy trade: (Exit Price - Entry Price) × Pip Multiplier. For a sell trade: (Entry Price - Exit Price) × Pip Multiplier. The multiplier is 10,000 for most pairs and 100 for JPY pairs.
Risk Warning
Forex trading involves significant risk of loss and is not suitable for all investors. The high degree of leverage can work against you as well as for you. Before trading forex, carefully consider your investment objectives, experience level, and risk tolerance. Never trade with money you cannot afford to lose.