When trading with currencies, a pip is the smallest unit of movement. Traders must monitor the movements closely since trades are done in high volumes. Small movements in trade cause significant profits or losses. Below, you will find our Pip Value Calculator to calculate the pip values, and analyze profit or loss. Our tools will help you to determine what a single pip value is for the specific transaction.

Our calculator will help you evaluate the monetary values of single pip movements for trade. It helps you in effective risk management and strategic planning. You must know pip values to calculate potential profits or losses and set take profit and stop loss levels.

How to Use Our Pip Value Calculator

Here are the steps you should follow to use our Pip Value Calculator

• Enter pip amount

First, enter the pip amount for the currency pair with which you are trading. It is fixed values, such as 0.0001 for most currency pairs or 0.01 for Japanese yen pairs.

• Select instrument

Now, you should select the trading instrument ( currency pair). The additional pairs are the metals, indices, energy, and famous cryptocurrencies such as Ethereum ( ETH), bitcoin ( BTC), litecoin ( LTC), ripple ( XRP), etc.

• Select trade size

In Trading, 1 standard lot is equal to 100,000 units. Units for 1 lot vary based on nonforex currency pairs. You also see that there is an option to calculate the pip values based on units traded or the number of lots traded. We choose the trading size of 1000 currency units or a micro lot of 0.01 lot.

• Select deposit currency

Pip values vary according to crypto cross and currency pair. Since the pip values are subjected to current market price quotes, you should choose the deposit currency on our calculator. Our tool helps you to calculate the pip values for selected currency pairs. Let us suppose we select EUR as the deposit currency on the tool.

• Tap on Calculate

Now, click on the calculate pip values button to calculate values. Our tool will use the current market price in real-time with an interbank rate (5-digit format). It will show you current pip values based on the selected deposit currency.

For example, the 0.01 lot trade pip values on EUR/USD with a current market rate of 1.08368 on EUR trading account, €0.0923. It is suggested to note that in trading accounts in base currencies, such as GBP or AUD, the pip value varies based on the current market rate for GBP/USD or AUD/USD. You can easily use a formula to calculate pip values for other currencies.

Pip Value = ( One Pip / Exchange Rate ) * Lot Size 

It will calculated as on our tool

Pip Value = (0.0001 / 1.08368) * 1,000 = €0.0923 

Introduction of Pip value calculator

Our pip value calculator manages risks, and makes your trade beneficial for you. Our tool is used to calculate pip values of various forex pairs, indices, metals, etc.

Our tools help traders calculate the monetary value of single pip movements of every trade.

As we know, pip stands for point in percentage and is used to evaluate the change in pip values between two trade currencies. So, the traders are suggested to know the gains and losses in number of pips their position falls or rises. Pip values are set prices that are used to determine the one pip move in trade. This term is used when calculating the trade gains or losses. Since the pip are small values, they are trade-in mini or micro lots. If we talk about pip values, there are some things that you should consider. The factors are currency pair, exchange rate, and trade size.

So, calculating pip values with our calculator helps you to determine the stop loss and take profit levels. Our tool calculates pip values by multiplying the trade amount in lots by one pip in decimal form. Then, it divides it by the exchange rate of the quoted currency in a currency pair.

Key Inputs

In forex trading, we have to understand the pip values to manage risk effectively. A pip is referred to as a small percentage in point. It refers to small price movements in currency pairs. Pip values varybased onf trade size and currency price. A pipette is a smaller forex unit, that is equal to 1/10^th of a pip. Our Pip value calculator tool gives you insights into pip values and helps you to make informed decisions.

• Currency pair

Pip values are tied to currency pairs. For most currency pairs, a pip is equal to movement in the 4^th decimal place. For Japanese yen pairs, it is the 2^nd decimal place. Market price affects pip values and changes with market dynamics. Our Pip value calculator helps you adapt to these market changes and gives you real-time insights.

• Trade size

Trades are measured in lots in forex. A standard lot is 100,000 units of base currency. A mini lot is 10,000 units and a micro lot is 1000 units. The larger the lot size is, the more the pip values are

For example, a one-pip change in the standard lot has more Monterey impact than a micro lot. So, you can use our Pip value calculator to calculate pip values and make financial analyses of lot sizes.

• Account currency

Pip values hinge on the currency of the trading account. If your account currency matches the quote currency of the traded pair, then pip values remain the same. If they are different, then you must convert the pip values to your account currency. It is easy to convert pip values by using our tool.

Calculation Process

You must understand the calculation process of pip values to trade effectively. Here is the formula to calculate the pip values

• Formula: Pip Value=Exchange Rate1 Pip×Trade Size

Here is example

1. Determine Exchange Rate: For example, let’s use the EUR/USD currency pair with a 1.2000 exchange rate.
2. Determine One Pip: For most of the currency pairs, one pip is 0.0001.
3. Enter the Trade Size: Let us take the trade size of 100,000 units (1 standard lot).

Using this formula, the calculation of pip value 100,000 unit EUR/USD trade is given below.

 Pip Value=1.20000.0001×100,000=8.33 USD per pip

This calculation shows that for every pip movement in the EUR/USD currency pair, the trader will lose or gain 8.33 USD. You have to understand the pip value to set the stop-loss and take-profit levels, manage the risk, and adjust trade sizes.

Importance of Pip Value

The pip values are prices that contribute to one pip move in forex trade. It is used when referencing position gains or losses. The pip values vary between currencies, and most pairs are priced to 4 decimal places. A pip is equal to the 4^th figure after the decimal point. In USD/GBP, for example, 1 pip is 0.0001. Here are the aspects where the pip values play a vital role

• Risk Management

Traders must know the pip values to manage the risk effectively. Pip values help you to calculate the impact of price movements on trade. They understand the monetary values of every pip and get estimates of potential profits and losses accurately.

This knowledge allows them to set precise stop loss and take profit levels and ensures that they do not take risks more than the percentage they are ready to take. Our pip value calculator calculates the pip values accurately and helps you make informed decisions. It protects your capital and enhances the trading performance.

• Trade Size Adjustment

The pip values play an important role in determining the trade size. Based on pip values, you must adjust position size to stay within risk tolerance levels. For example, if our calculator tool shows you high pip values, then you must reduce the trade size and manage risks.

On the other hand, if our tools show you pip values are low, then you must increase the trade size. It is a good option for traders to make huge profits. These adjustments help traders  hen they trade with high leverage, where small price movements have a financial impact. By using pip values to help traders make decisions, they can maintain a controlled and balanced approach to trade. It reduces the risks of big losses in your trade.

Practical Use of Our Pip Value Calculator

Here are the applications where our Pip value calculator is used  and benefits traders

• Set stop loss and take profit levels.

The pip values are important to set stop loss and take profit levels. By knowing the monetary value of a pip, you must determine how much risk you are willing to take on every trade. You should know the position where you should set stop-loss orders to reduce losses.

For example, if the trade is willing to takea  $ 100 risk-on the trade, and the pip value is 10 USD, then they will place their stop loss of 10 pips away from the entry point. As same take profit levels are set based on profit targets, and ensures that the traders lock in profits at the right time. This position of orders based on pip values helps you maintain a disciplined trading approach.

• Manage risk

Our pip value calculator helps you understand the monetary values of every pip movement. It helps you to manage risks. Once you calculate the pip values, you can assess the potential impact of price fluctuations on trade and adjust positions. It helps you to avoid overexposure and make informed decisions about leverage and trade size.

For example, if traders find the pip value of every currency pair is too high than the account size, then it will reduce trade size and manage risk better. On the other hand, if the pip value calculated by our tool is low, then it increases the position size to achieve gains. Using our calculator guides you to make trading decisions, manage risks, and maintain your balanced trading strategy.

Common Mistakes

While calculating pip values from our tool, some traders make some common mistakes. So, here are the mistakes you should avoid

• Not Calculating Pip Value

The major mistake traders make is not calculating the pip value before entering to trade. Without understanding pip values, traders are unable to gauge the potential financial impact of price movements. This mistake caused unexpected losses, as traders were not aware of the amount of money they were at risk per pip movements. For example, if traders expected pip values lower than it is, they end up risking more than the goal amount. It led to huge losses. So, it is suggested that traders use our pip value calculator tool, calculate the pip values, and get a proper understanding of potential risk exposure on every pip.

• Overexposure

Overexposure is another common mistake traders make. It occurs when traders trade on large positions. It goes beyond the risk tolerance and account size. This problem occurs when you perform trade with high leverage. High leverage causes both gains and losses and ensures that pip values are aligned with the risk management approach.

If pip values are high for the size of the trade, then small price movements cause big losses. To avoid this problem, you must adjust trade size based on pip values. It ensures that your trade fits your risk management plan. It gives full control over risk and avoids huge losses.