Forex Lot Size and Pip Value Explained (With Examples)
In forex, a lot is the unit used to measure trade size, and a pip is the standard unit for measuring price changes. A standard lot is 100,000 units of the base currency, a mini lot is 10,000 and a micro lot is 1,000. For most pairs, a pip is the fourth decimal place (0.0001); for Japanese yen pairs, it is the second (0.01). Pip value, the amount one pip is worth, equals the pip size multiplied by the number of units traded, converted into the account currency. For EUR/USD, one pip on a standard lot is worth $10.