What is a pip?

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rob559 posted:
babyschool.com you know that ?

good date. 😀

You will definitely find the answer here - https://www.babypips.com/ . Also a lot more useful information. 😉

A pip is the least possible change in the value of a currency pair. If for example the EUR / USD pair moves from 1.3150 to 1.3151, that is 1 PIP. A pip is the last decimal in the quote. Through the pips you will calculate the gains and losses.

Maybe a pip looks like a very small number but the winnings should be calculated in batch. The gains are seen more when the dollar is the base currency.

mlfrx posted:
Maybe a pip looks like a very small number but the winnings should be calculated in batch. The gains are seen more when the dollar is the base currency.

Of course, to pass the amount of pips to money won or lost is necessary to know the volume of the operation, that is, the number of lots with which the purchase or sale has been made in a currency pair.

mlfrx posted:


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Thank you for contributing this video.
Very good. 😁

mlfrx posted:


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Thanks for sharing. The video is useful 😄

Pips or point in percentage is the standardized unit of measurement to explain the change in value between two currencies. Pip is the smallest change an exchange rate can make. This uniform unit helps to protect investors’ from heavy losses. For most of the major currencies the value of pip is given by the 4th decimal place of the quotation. For example for EUR/USD, if the value moves from 1.1151 to 1.1152 then that 0.0001 rise in USD relative to Euro is “1 PIP”. But yen based currencies are exceptions and are displayed to only two decimal places. Example: if USD/JPY moves from 101.76 to 101.78, then this quote has 2 pip spread between the bid and ask price.
Also some brokers now offer fractional pips or popularly known as pipettes to provide the investor an additional digit of precision and transparency on the major currency pairs. For example if AUD/USD moves from 0.75840 to 0.75842, then the 0.00002 rise in USD is equal to 2 pipettes.