» Currency Trading Terms: Pip

Percentage in point on the FX marketOne of the currency trading terms you are likely to come across is "pip." Pip stands for percentage in point. It is the smallest amount of change in forex trading.

For most currencies, forex trading quotes are shown in four decimal places. For example, euro/dollar may be 1.5864. The pip is that last decimal place, representing the smallest change possible.

It is important to note that the Japanese yen, however, is an excpetion. The yen is only quoted out to two decimal places.

See Also

• New to Currency Trading?
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