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A pip calculator is an essential trading tool for risk management. The calculator is used to work out the pip value of forex pairs, precious metals, indices, and more, in the account currency.

To calculate the value of a pip, the Axi pip calculator multiplies one pip (usually 0.0001) by the trade size (in lots), and dividing this by the real-time market rate of forex pair.

Pip value = (Pip in decimal form * Trade Size in lots) / Exchange rate

Example:

Account base currency: GBP

Instrument: AUS200

GBPUSD rate: 1.79

Trade size: Lots

Trade size: 5

The pip size is 1, that is, one pip is one AUD of the AUS200 price. Also, for a trade size of 5 lots, we see that for a one pip movement, position will gain or lose 2.79 GBP

1 AUD per pip per lot * 5 lots / 1.79 AUD per GBP = 2.79 GBP per pip Prices at time of calculation

A “pip” – which stands for “Point in Percentage” (or “Price Interest Point”) – is the smallest change in value between a currency pair. A pip is based on the last decimal of the price of the quote currency. For instance, when the GBP/USD goes from 1.2022 up to 1.2024, there is a change of 2 pips.

**Examples: **

EUR/USD = 1.0718

USD/CHF = 0.9267

EUR/GBP = 0.8916

Identifying the pip depends on the currency pair you are trading. The majority of the pairs are priced out to four decimals, with the exception of pairs that include the Japanese Yen.

- For
**most FX pairs,**1 pip is 0.0001 and represents any movement in the fourth decimal place (e.g., 1.2022 -> 1.2024) - For
**FX pairs with the Japanese Yen**(e.g., USD/JPY; GBP/JPY; EUR/JPY), 1 pip is 0.01 and represents any movement in the second decimal place (e.g., for USD/JPY: 131.91 -> 131.92)

Many forex brokers go beyond the standard pip by also quoting fractional pips, or pipettes, which represent a “tenth of a pip”. When quoted, fractional pips always follow the pip as a 5th decimal (or 3rd decimal if the currency pair includes the Japanese Yen).

**Examples: **

EUR/USD = 1.07183

USD/CHF = 0.92676

EUR/GBP = 0.89165