Pip value formula
Pip value (quote currency) = Pip size × Units
Quote is USD (EUR/USD): Pip value = Pip size × Units
Base is USD (USD/JPY): Pip value = Pip size × Units ÷ Price
Cross pair (EUR/GBP): Pip value = Pip size × Units ÷ USD/GBP rateLot size formula
Lots = (Balance × Risk %) ÷ (Stop loss in pips × Pip value per lot)Worked example
On EUR/USD a pip is 0.0001, so one standard lot (100,000 units) is worth $10 per pip. With a $10,000 account, 1% risk and a 25-pip stop, you can risk $100: $100 ÷ (25 × $10) = 0.40 lots, or 40,000 units.
Frequently asked questions
What is a pip?
A pip is the standard unit of price movement in forex: 0.0001 for most pairs and 0.01 for pairs quoted in Japanese yen. For gold (XAU/USD) this calculator uses 0.01, the most common broker convention.
What are standard, mini and micro lots?
A standard lot is 100,000 units of the base currency, a mini lot 10,000 and a micro lot 1,000. For gold, one standard lot is usually 100 ounces.
Why do I need a conversion rate for cross pairs?
Pip value is first calculated in the quote currency. For pairs like EUR/GBP or EUR/JPY it must be converted into your USD account currency, which needs the USD rate for that quote currency.
Is pip value the same at every broker?
The maths is the same, but contract sizes for metals and CFDs vary by broker. Check your broker’s contract specification for anything other than major currency pairs.
Results are estimates for educational purposes only and are not investment, tax or financial advice. Verify figures with your broker or advisor before acting on them.