Guide · Basics
What is a pip in trading? Pips and forex lot sizes explained
A pip is the fourth decimal place of a currency price, 0.0001, or the second, 0.01, on pairs quoted in Japanese yen. On one standard lot of EUR/USD (100,000 euros) a pip is worth $10; on a micro lot, 10 cents. Below: pip values for five pairs and three lot sizes, and what a spread in pips costs in money at two brokers.
Low Spread Brokers does not give personal investment advice.
Key takeaways
- 1Pip value = pip size × units, in the second currency of the pair: 0.0001 × 100,000 = $10 on EUR/USD.
- 2Lot sizes: standard 1.00 = 100,000 units, mini 0.10 = 10,000, micro 0.01 = 1,000.
- 3If the pair is not quoted in your account currency, convert: USD/JPY at an illustrative 150 is $6.67 a pip per lot.
- 4Spread cost = spread in pips × pip value: 1.2 pips on one lot of EUR/USD is $12; on a raw account add the commission.
Quick answer
What are pips in trading?
A pip is the unit a currency price is counted in: 0.0001 for EUR/USD, GBP/USD and most pairs, 0.01 for pairs ending in JPY. If EUR/USD moves from 1.1000 to 1.1025, it has moved 25 pips. What a pip is worth depends on the size of the position: $10 on one standard lot of a pair quoted in US dollars, $1 on a mini lot and $0.10 on a micro lot.
- In EUR/USD 1.10005 the fifth decimal is a pipette, a tenth of a pip (third decimal on yen pairs).
- One lot of EUR/USD pays $10 a pip at 1:30 and at 1:10: leverage does not change the pip value.
- A 20-pip stop on 0.10 lot of EUR/USD risks $20: pip value turns stops, targets and spreads into money.
What does pips mean in trading?
A pip is the standard step of a currency quote. On EUR/USD at 1.1000 the fourth decimal is the pip; a move to 1.1001 is one pip, a move to 1.1100 is 100 pips. Pairs quoted in yen are priced with two decimals, USD/JPY at 150.00 for example, so the pip is 0.01 and a move to 150.25 is 25 pips.
Five-decimal quotes add one more digit: EUR/USD 1.10005, USD/JPY 150.005. That last digit is a pipette, a tenth of a pip, so a platform that counts in pipettes shows a 1.2-pip spread as 12.
Pips are a forex convention. Indices, shares and commodities are quoted in points of the price itself, so an index moving from 8,000 to 8,010 has moved 10 points; check the contract specification before you apply forex pip arithmetic to them.
Forex lot sizes explained: standard, mini and micro
A lot is the trade size in units of the first currency of the pair, the base currency. Platforms take the size as a decimal of a standard lot, so 0.10 is a mini lot and 0.01 a micro lot. Pip value grows in step with the size:
| Lot | Size on the platform | Units of the base currency | Pip value |
|---|---|---|---|
| Standard | 1.00 | 100,000 | $10.00 |
| Mini | 0.10 | 10,000 | $1.00 |
| Micro | 0.01 | 1,000 | $0.10 |
Cent accounts, listed in our data by Exness, Vantage and XM, count the balance in cents and allow smaller trades still. Check which company would hold one: Exness does not accept UK or EEA retail clients, and the FCA licence in XM’s group belongs to its sister brand Trading.com, not to XM.
Forex pip value by pair and lot size
The pip is counted in the quote currency, the second one in the pair. When that is your account currency, the pip value needs no conversion. When it is not, divide by the rate if your currency is the base (USD/JPY, USD/CHF on a USD account) or multiply by the quote-to-account rate otherwise (EUR/GBP on a USD account uses GBP/USD).
| Pair | Pip size | 1 lot, USD account | 0.10 lot, USD account | 0.01 lot, USD account | 1 lot, GBP account |
|---|---|---|---|---|---|
| EUR/USD | 0.0001 | $10.00 | $1.00 | $0.10 | £8.00 |
| GBP/USD | 0.0001 | $10.00 | $1.00 | $0.10 | £8.00 |
| USD/JPY | 0.01 | $6.67 | $0.67 | $0.07 | £5.33 |
| EUR/GBP | 0.0001 | $12.50 | $1.25 | $0.13 | £10.00 |
| USD/CHF | 0.0001 | $11.76 | $1.18 | $0.12 | £9.41 |
The rates are round examples, so the converted figures are too. The pip calculator takes the live rate you enter and works for any pair on a USD, GBP, EUR or AUD account.
How to calculate pip value in forex
Step 1: pip size × units = pip value in the quote currency. For 0.5 lot of GBP/USD that is 0.0001 × 50,000 = $5. Step 2: convert it if your account is in another currency. On a GBP account at an illustrative GBP/USD 1.25, $5 ÷ 1.25 = £4.00.
The yen works the same way with a bigger pip: one lot of USD/JPY is 0.01 × 100,000 = ¥1,000 a pip, which is $6.67 at 150 and moves whenever USD/JPY moves.
Pip price of a spread: what the same pips cost on different pairs
A spread is quoted in pips, so its cost depends on the pair. Pepperstone publishes average spreads for its Standard account: 1.1 pips on EUR/USD, 1.2 pips on GBP/USD, 1.2 pips on USD/JPY. A USD/JPY pip is worth $6.67 per lot at the illustrative rate instead of $10, so the same number of pips costs less in dollars.
| Pair | Average spread | Pip value per lot | Spread cost per lot |
|---|---|---|---|
| EUR/USD | 1.1 pips | $10.00 | $11.00 |
| GBP/USD | 1.2 pips | $10.00 | $12.00 |
| USD/JPY | 1.2 pips | $6.67 | $8.00 |
USD/JPY at an illustrative 150: $8.00 a lot. Spreads are averages as Pepperstone publishes them, not our measurements; the spread you pay on a given trade can be wider.
Standard or raw account: the same pip value, two prices
On a standard account the whole price is in the spread. On a raw account the spread is smaller and a commission is charged per lot. Tickmill publishes EUR/USD from 1.6 pips on its Classic account and from 0.0 pips on Raw, with USD 3.00 per lot per side. At $10 a pip, one lot costs at least $16.00 on Classic and $6.00 on Raw (spread plus $6.00 commission for opening and closing).
Those are “from” spreads, the lowest each account shows, so real costs are higher. The brokers on this guide’s list all offer both models; first are CMC Markets, OANDA and Vantage.
Currency trading lot size: choose it from the stop, not the balance
Lot size = money at risk ÷ (stop in pips × pip value per lot). With USD 2,000 in the account, 1% at risk is $20. A 25-pip stop on EUR/USD costs $250 per standard lot, so the size is 20 ÷ 250 = 0.08 lot. A wider stop means a smaller position for the same risk.
- 0.01 lot on EUR/USD: a 25-pip stop risks $2.50.
- 0.10 lot: the same stop risks $25.00.
- 1.00 lot: the same stop risks $250.
The lot size calculator does this for any pair and account currency before you round the result down to your broker’s lot step.
Brokers with both a standard and a raw account
Why this order: Only brokers with both a commission-free Standard account and a raw-spread account with commission, a Tier 1 company open to retail clients and a published minimum deposit of USD 100 or less (or zero in any currency), sorted by the lowest EUR/USD spread each publishes, ties broken by our costs score; on these accounts you can turn both pricing models into money with the same pip value. Ranked from our data on 8 brokers, updated 19 Oct 2026.
- 1CMC Markets7.9/10 · Minimum deposit £0 · 0.0 pipsVisit brokerUnpaid link
69% of retail investor accounts lose money when trading CFDs with this provider (CMC Markets UK plc).
- 2OANDA8.1/10 · Minimum deposit $0 · 0.0 pipsVisit brokerUnpaid link
76.6% of retail investor accounts lose money when trading CFDs with this provider (OANDA Europe Limited).
- 3Vantage8.0/10 · Minimum deposit $50 · 0.0 pipsVisit brokerUnpaid link
72.65% of retail investor accounts lose money when trading CFDs with this provider (Vantage Global Prime LLP).
Risk warning:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Most retail investor accounts lose money. Consider whether you understand how CFDs work and whether you can afford the high risk of losing your money.
Low Spread Brokers does not give personal investment advice.
FAQ
Pips and lot sizes: questions
Short answers from the same broker data and country reference as the rest of the site, collected up to 19 Oct 2026. Terms change: check the broker’s own page before you trade.
Ask a questionWe cannot give personal investment advice.
1What is a pip in trading?
The fourth decimal place of a currency price, 0.0001, or the second, 0.01, on yen pairs. EUR/USD moving from 1.1000 to 1.1050 is a 50-pip move.
Data collected up to 19 Oct 2026
2How much is 1 pip worth?
$10 on one standard lot of a pair quoted in dollars, such as EUR/USD, on a USD account; $1 on 0.10 lot and $0.10 on 0.01 lot. On other pairs it depends on the rate: $6.67 per lot on USD/JPY at an illustrative 150.
Data collected up to 19 Oct 2026
3What is a lot size in forex?
The trade size in units of the base currency: a standard lot is 100,000 units, a mini lot 10,000 and a micro lot 1,000. Platforms show them as 1.00, 0.10 and 0.01.
Data collected up to 19 Oct 2026
4What is a pipette?
A tenth of a pip: the fifth decimal on EUR/USD (1.10005) or the third on USD/JPY (150.005). Platforms that quote pipettes may show a 1.2-pip spread as 12.
Data collected up to 19 Oct 2026
5How do I calculate pip value in forex?
Multiply the pip size by the number of units to get the value in the quote currency (0.0001 × 100,000 = $10 on EUR/USD), then convert it to your account currency at the current rate if they differ.
Data collected up to 19 Oct 2026
6What lot size should a beginner use?
The size your stop allows, not a fixed number. With USD 2,000 and 1% risk, a 25-pip stop on EUR/USD gives 0.08 lot. At 0.01 lot a pip on EUR/USD is $0.10.
Data collected up to 19 Oct 2026
7Are pips the same on gold, indices and crypto?
No. Brokers set the price step and contract size per instrument, so 1 point on an index CFD is not worth $10 the way 1 pip on a lot of EUR/USD is. The contract specification on your platform shows both.
Data collected up to 19 Oct 2026
Sources
The pip arithmetic is standard and needs no source; the broker figures come from our broker data, each with the date it was copied from the broker’s own page.
- Pepperstone UK: forex pairs and spreads (Standard account averages)Checked on 19 Oct 2026
- Tickmill: account types overview (Classic and Raw spreads, commission)Checked on 19 Oct 2026