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What is a Pip?

Posted By: TradersLog

A pip is the smallest price increment in forex trading – pip stands for percentage in point.

Prices are quoted to the fourth decimal point in the forex market – for example EUR/USD might be bid at 1.1914 and offered at 1.1917. In this example we can see that the spread is 3 pips wide. The Japanese Yen (JPY) is an exception – it is quoted only to the second decimal point.

See also: Forex Market

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