At Traderís Way, Prime Online Forex and CFD broker, we provide our clients with the very latest from trading apps to charting software along with some of the most competitive trading conditions in the market. As part of our ongoing edu series, here is a brief recap on calculating pip value. To calculate the pip value, traders can use this simple formula to work out the value of one pip .
Pip Value = Position Volume x Counter Currency 1 pip
Example: Position 1 lot of EURUSD. Pip Value = 100,000 x 0.0001 = 10 USD
And to work out the value of the pip in terms of oneís account currency, traders can use this,
Pip Value in Account Currency = Pip Value / Account Currency-Counter Currency Rate
Example: Position 1 lot of EURJPY. Account Currency - USD. USDJPY = 80.00. Pip Value = 100,000 x 0.01 = 1,000 JPY. Pip Value in USD = 1,000 / 80.00 = 12.5 USD.
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