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Forex question WHAT IS THE MEANING OF A PIP?
avatar Mymelody
Question by: Samanthar - 26 Sep 2016, 09:33:42
WHAT IS THE MEANING OF A PIP?
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Answers (1)
avatar user 10900
Answer by: Joseph - 26 Sep 2016, 09:37:55

The word ‘PIP’ is an expression for ‘percentage in point’. The term historically refers to the smallest incremental movement in prices in the currencies trading market. The majority of currency pairs are quoted to four decimal places so the smallest PIP movement is of the fourth decimal place. For example, if EUR/USD rose from 1.2984 to 1.2986 it has raised two PIPs. Sometimes a PIP is also referred to as a point.

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