A 20-pip move does not tell you the money gained or lost. You also need the symbol's pip convention, the actual position amount and the currency in which profit is measured. A bigger leverage setting does not directly change pip value for an unchanged position. This guide builds the units first, then walks through executable prices and currency conversion. It is an explanation of arithmetic, not a trading signal or a live pip-value calculator.
1. Read the pair before counting pips
In a pair A/B, A is the base currency and B is the quote currency: the price is units of B for one unit of A. EURUSD 1.10000 means 1 EUR is quoted at 1.10000 USD. A pip is a conventional price-distance unit. For many currency pairs it is 0.0001; for common JPY-quoted pairs it is 0.01. These conventions do not make a pip the smallest price change on every broker feed.
Set pip size explicitly for the exact instrument. A suffix does not identify the contract or the cash value by itself. Metals, indices, crypto and unusual contracts may use different conventions and profit calculations; do not apply the Forex examples automatically. Check the broker's symbol specifications.
2. Separate pip, point, pipette and tick
In MT4, Point is the displayed point size for that symbol, while Digits describes decimal precision. A pipette is one tenth of a conventional pip. On a typical five-decimal EURUSD quote, one point is one pipette, but the executable tick grid is a separate specification. Four versus five digits changes the number of points in one pip; it does not change the conventional pip from 0.0001 to 0.00001.
| Illustrated quote | Pip size | Point size | Points per pip |
|---|---|---|---|
| EURUSD · 5 | 0.0001 | 0.00001 | 10 |
| EURUSD · 4 | 0.0001 | 0.0001 | 1 |
| USDJPY · 3 | 0.01 | 0.001 | 10 |
| USDJPY · 2 | 0.01 | 0.01 | 1 |
The table states illustrative conventions, not a rule inferred only from decimal count. A quoted price must still lie on the valid tick grid. A spread of 20 points under the five-decimal EURUSD specification is 2 pips; the same phrase under a different specification can mean a different price distance.
3. Divide price distance by pip size
A EURUSD Bid move from 1.10000 to 1.10150 is 0.00150 / 0.0001 = 15 pips. A USDJPY Bid move from 150.000 to 150.130 is 0.130 / 0.01 = 13 pips, or 130 points when Point is 0.001. Preserve the sign when describing direction; use absolute distance only when that is the intended measurement. Display rounding should not change the underlying comparison.
A chart move is not automatically the distance between a trade's executed entry and exit. Standard MT4 Forex charts normally show Bid bars. A BUY opens at Ask and closes at Bid; a SELL opens at Bid and closes at Ask. The later example uses those execution sides rather than silently treating chart closes as fills.
4. Derive value in the quote currency
For the linear Forex contract assumed here, let C be base-currency units per lot, L the position in lots and p the pip size in quote currency per base unit. The position amount is C × L, and value for one pip is C × L × p in the quote currency. With C = 100000 and L = 0.20, EURUSD has 20000 EUR of base amount and 2 USD per pip. The same base amount on GBPJPY gives 200 JPY per pip, not 200 USD.
The cash value scales with position amount. Standard, mini and micro labels commonly describe 100000, 10000 and 1000 base units, but use the contract definition on the actual account. The table assumes a USD account, EURUSD and a 100000-unit contract. It demonstrates size, not a recommended allocation or risk budget.
| Position, lots | Base amount, EUR | USD per pip |
|---|---|---|
| 1.00 | 100000 | 10.00 |
| 0.10 | 10000 | 1.00 |
| 0.01 | 1000 | 0.10 |
| 0.20 | 20000 | 2.00 |
5. Check the familiar $10-per-pip shortcut
Under those exact assumptions, 1.00 lot is $10 per pip, 0.10 lot is $1, 0.01 lot is $0.10, and 0.20 lot is $2. The shortcut works here because the quote currency and account currency are both USD. It is not a universal property of a standard lot: a JPY quote, a different contract size or another account currency changes the result.
Leverage concerns the margin needed to support a position. If contract size, position amount and conversion are unchanged, changing leverage alone does not change the cash effect of one pip. A larger position still creates a larger pip value even when the required deposit looks small. Use risk management for the decision about exposure, rather than treating available margin as a loss allowance.
6. Reproduce a BUY from actual price sides
Assume an opening EURUSD quote of Bid 1.10000 / Ask 1.10020 and a BUY fill of 0.20 lot at Ask 1.10020. Closing immediately at the unchanged Bid would give -2 pips, or -$4 gross. In an alternative later exit at Bid 1.10150, executed distance is +13 pips, not the +15-pip move between the two Bid readings. At $2 per pip, gross profit is $26.
A separate alternative exit at Bid 1.09920 gives -10 pips and -$20 gross. Assume total opening-and-closing commission is $7 per lot, or $1.40 for 0.20 lot, and no swap or conversion fee. The two results become +$24.60 and -$21.40. Spread is already reflected in the actual price sides: do not subtract it again. Actual fills, gaps, fees and financing can differ. These invented alternatives supply no entry rule or expected outcome; see trading costs for a full cost comparison.
7. Convert quote-currency amounts into account currency
If quote currency equals account currency, no currency conversion is needed for that amount. Otherwise read the direction and units of the conversion pair. A rate stated as account-currency units per quote-currency unit multiplies the amount; the inverse quote divides it. Multiplying or dividing simply because a pair contains USD is not a reliable rule.
Bid/Ask also matters when illustrating cash conversion. Selling a positive balance of the base currency uses Bid; buying that base currency to fund a debit uses Ask. With the inverse pair, a positive quote-currency balance buys base currency at Ask, while funding a quote-currency debit by selling base currency uses Bid. Broker profit conversion may use its own defined route, timing, rounding and fees. Check that policy instead of assuming an illustrative conversion is the broker's exact booked result.
8. Work through a JPY cross and a USD account
Assume GBPJPY, C = 100000 GBP per lot, L = 0.20 and p = 0.01 JPY per GBP. One pip is 200 JPY. To illustrate conversion, use a simultaneous USDJPY quote of Bid 149.98 / Ask 150.02, measured in JPY per USD. A 200 JPY credit buys about 1.33316 USD at Ask; funding a 200 JPY debit costs about 1.33351 USD at Bid. Use full precision until the final money display.
A hypothetical +13-pip amount is +2600 JPY; 2600 / 150.02 is about +$17.33. A hypothetical -10-pip amount is -2000 JPY; funding it costs 2000 / 149.98, about $13.34. These examples omit costs and assume the shown conversion is available. If the conversion rate changes, USD pip value changes even when GBPJPY position size is unchanged. Do not apply one current pip value to every historical trade.
9. Cross-check MT4 tick-value units
MetaQuotes documents MODE_TICKVALUE in deposit currency and MODE_TICKSIZE in points. Convert that tick size to price units by multiplying it by MODE_POINT before comparing it with pip size. SYMBOL_TRADE_TICK_SIZE is instead a minimal price change in price units. Do not multiply that value by Point a second time. MT4 also marks several related MQL5-style properties as unsupported; do not assume every enum produces a usable MT4 value.
For a stated per-lot tick value v and tick size t in price units, the pip-value check is v × p / t per lot, then multiplied by L. Under the illustrative five-decimal EURUSD specification, v = $1, t = 0.00001 and p = 0.0001 give $10 per lot per pip. This check requires compatible units and a verified profit-calculation mode. Zero, missing, stale or inconsistent data is a reason to investigate, not to replace it with a guessed $10 constant.
Optional: unit-checked formulas and conversion arithmetic
These are unit relations, not an executable EA. Confirm the symbol, contract, lot basis and broker conversion method before using them. Positive and negative conversion examples represent exchanging the stated currency amounts, not a guarantee of terminal settlement.
base_amount = C × L; quote_value_per_pip = C × L × p
EURUSD: 100000 × 0.20 × 0.0001 = 2.00 USD/pip
BUY: (1.10150 − 1.10020) / 0.0001 = +13 pips; +13 × 2 = +26 USD
BUY: (1.09920 − 1.10020) / 0.0001 = −10 pips; −10 × 2 = −20 USD
0.20 × 7 = 1.40; 26 − 1.40 = 24.60; −20 − 1.40 = −21.40
GBPJPY: 100000 × 0.20 × 0.01 = 200 JPY/pip
2600 / 150.02 = 17.33102253… USD; 2000 / 149.98 = 13.33511135… USD
t_price = MODE_TICKSIZE × MODE_POINT
pip_value_per_lot = MODE_TICKVALUE × p / t_price
t_price = SYMBOL_TRADE_TICK_SIZE; pip_value_position = pip_value_per_lot × L
10. Keep a small, repeatable verification record
Record the exact symbol and account currency, pip convention, Point, Digits, tick size and its unit, contract size, volume and quote timestamps. Recompute a one-pip change from both contract units and tick-value units, then compare with a suitable demo example under the broker's stated method. Check both gain and loss cases, conversion direction and total charges. A screenshot of a rounded profit field alone cannot explain all of these inputs.
Keep calculations distinct: price distance, gross money result, account-currency conversion and net result after costs. For a planned stop, convert the executable distance into money using the actual position amount; gaps and execution costs can exceed that plan. This guide does not select lot size. Continue with ATR stop and sizing examples and the risk framework, keeping their assumptions explicit.
11. Questions about Forex pips and pip value
Is one pip always ten MT4 points?
No. It is ten points under the illustrated five-decimal EURUSD and three-decimal JPY specifications, but one point under the illustrated four-decimal EURUSD and two-decimal JPY specifications. Check the symbol's pip convention and actual point size.
Is a standard lot always worth $10 per pip?
No. That result assumes a 100000-unit contract, pip size 0.0001 and USD as both quote and account currency. Other quote currencies, contracts or account currencies can give a different value.
Does higher leverage increase pip value?
Not for an otherwise unchanged position and conversion rate. A larger position increases pip value; leverage affects margin requirements. Available margin is not a safe loss budget.
Why can my terminal result differ from a pip calculation?
Check executed Bid/Ask prices, volume, contract units, conversion route and time, commission, swap, fees and rounding. A pip-distance figure or chart move alone is not a complete net-profit calculation.
12. Sources and scope
Primary references: OANDA's explanation of pips and fractional pips, MetaQuotes symbol-property units and SymbolInfoDouble and data availability. Checked on 2026-10-19. The formulas and invented examples are our worked unit checks; broker-specific contracts and settlement rules require separate verification.
Forex and leveraged trading involve substantial risk. This material is educational, not investment advice. All quoted prices and money examples are invented; they are not live rates, forecasts or evidence of strategy performance.