In forex trading, a pip, short for percentage in point, is the standard unit for measuring price movement.

In forex trading, a pip, short for percentage in point, is the standard unit for measuring price movement. Understanding pips helps you read quotes, compare spreads, set stop losses, and size positions with precision. For most currency pairs, one pip equals 0.0001; for JPY pairs, one pip equals 0.01. If EUR/USD rises from 1.0850 to 1.0858, it moved 8 pips. Pip value depends on trade size: on a standard lot of 100,000 units, one pip is roughly $10 on most USD-quoted pairs; on a mini lot of 10,000 units, it is about $1. Pips also underpin trading costs, because brokers quote spreads in pips, and they anchor performance by letting you track risk and reward consistently across trades. Knowing how to calculate pips and pip value is essential for risk management, position sizing, and evaluating your strategy. Use simple rules, a calculator, or your platform's readouts to convert pips into currency terms before placing any order. If you searched forex what is pip, this page gives you a clear, practical guide.