Forex Pip Calculator

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What is a Forex Pip Calculator?

A forex pip calculator is a currency trading tool which calculates the amount of profit or loss per trade, as well as the value of one currency unit in terms of another. The second currency (the reference currency) is always given as number 1 and the first currency (the counter currency), always dropped to give two decimal places. For example, if you bought 1-lot on EURUSD and sold 1-lot at USDJPY, then:

EURUSD: 1 / .8765 = 1.1326 –> BUY 100 –> PROFIT AT SELL >= PIP

USDJPY: 100 / 143.20 = 0.6843 –> SELL 100 –> LOSS AT BUY <= PIP

Pips show the smallest incremental move a currency pair makes and is one of the most important concepts in trading. The pip value changes with currency pairs and can be higher or lower, depending on which currency is considered the base currency. One pip for USDCAD is different from one pip for EURJPY as their exchange rates are different. Pay attention to how many pips you make/lose when you place your trades. This will help you anticipate your gains and losses more accurately, allowing you to manage your positions better.

Why To Use Forex Pip Calculator?

Forex dealers and traders use a forex pip calculator in order to:

- Calculate potential profit or loss from a trade.

- Make decisions based on the size of their trades.

- Assist them in how to manage their trading account(s).

The above reasons make it clear why it is important for traders to learn how to use a forex pip calculator. You will not become a successful trader overnight, but by using a forex pip calculator you can have an idea what your profits and losses are going to be before calculating actual numbers. This will help you manage your trading better as you know what you stand to gain or lose each time you place a trade.

Tricks To Use Forex Pip Calculator: - Always remember that one pip changes with currency pairs and give equal importance to both currencies being exchanged so as to make the right trade.

- Pay attention to how many pips you make/lose as this will help you anticipate your gains and losses.