Pip

Definition

A pip (Percentage in Point) is the smallest price move in a forex quote. For most currency pairs, a pip equals 0.0001 (the fourth decimal place). For JPY pairs, a pip is 0.01 (the second decimal place). Pips are the standard unit for measuring price changes and calculating profit or loss in forex trading. For example, if EUR/USD moves from 1.1050 to 1.1055, that's a 5-pip move.