Find the value of one pip for a given lot size and pip size.
Pip value = Pip size × Lot size (units) × Quote-to-account currency conversion rate (use 1 if your account currency matches the quote currency).
Educational tool only — not investment advice. Markets involve risk; past performance and illustrative math don't guarantee future results.
A pip — the smallest standard price move in most forex pairs — has a genuinely fixed dollar value only under one specific condition: when USD is the quote currency, as in EUR/USD or GBP/USD, where one pip is worth approximately $10 on a standard lot (100,000 units), $1 on a mini lot, and $0.10 on a micro lot. Outside that condition, pip value isn't fixed at all. When USD is the base currency instead of the quote currency, such as USD/JPY or USD/CHF, pip value shifts with the current exchange rate rather than staying at a round $10 figure — and on cross pairs that don't involve USD directly at all (like EUR/GBP), the calculation requires an extra conversion step through the relevant exchange rate.
This distinction matters well beyond academic interest, because pip value is the multiplier that turns a stop-loss distance (measured in pips) into an actual dollar risk figure — the same 20-pip stop-loss represents a very different real dollar risk on EUR/USD than it does on USD/JPY at a given lot size, purely because the pip values differ. Getting pip value wrong for a given pair is one of the most common, entirely avoidable position-sizing mistakes new forex traders make, since it silently changes the actual risk taken on a trade even when the lot size and stop-loss distance both look identical to a trade on a different pair.
A pip is the standard smallest price increment most forex pairs are quoted in — typically the fourth decimal place for most pairs, or the second decimal place for pairs involving the Japanese yen. It's the standard unit used to measure price movement and calculate profit, loss, and risk.
Pip value is roughly $10 per standard lot only when USD is the quote currency (EUR/USD, GBP/USD). When USD is the base currency (USD/JPY, USD/CHF) or the pair is a cross that doesn't involve USD at all, pip value shifts with the current exchange rate and isn't a fixed round number.
Pip value is the multiplier that converts a stop-loss distance in pips into an actual dollar amount at risk. The same 20-pip stop-loss at the same lot size represents different real dollar risk on different currency pairs, purely because their pip values differ — which is why pip value has to be calculated per pair, not assumed.
The trade ends up risking a different dollar amount than intended, even if the lot size and stop-loss distance look correct on paper. This is a common, entirely avoidable mistake for traders moving between different currency pairs without recalculating pip value for each one.