Pips are probably the most used term in the “Forex Market”. Forex market is the global online platform for exchanging foreign currencies worldwide. Traders from all around the world exchange currencies according to their needs and try to gain profit.

Generally, pip (price interest point or % in point) is the fluctuation in currencies in fractions of a dollar. Meanwhile, lot refers to the unit, used in measuring the transaction’s amount. In the trading process, the traders are required to know the value of pips with lot size to find out the amount of gained profit or incurred loss.

That’s why doing the calculation of pip with lot size is crucial. This can be done both by manually and with the help of different available pip calculators.

1. Manual Calculation through Formula

There are different available apps to do the task. But calculating the pips with a lot size through formula often provides the traders with some extra mental assurance.

So, what is the required formula to calculate the pip value with a lot size?

Well, The formula looks like this :

Pip value = ( 1 pip  Lot size )  Exchange rate of currency

Short descriptions of the terms:


To calculate the pip value with this formula, you need to know the 1 pip amount which in general is 0.0001 in USD related currencies. But this value differs in case of JPY related combinations. In Japanese Yen, 1 pip = 0.01.

Lot size:

The lot size is divided into three main categories.These are Standard, Mini and Micro. In Standard lot size, 1 lot=100,000 units of given currencies; in Mini lot size the unit is 10,000 and in Micro the unit is 1000 in given currencies. You will enter your preferable lot size in the formula to calculate the pip value. Learn more from https://safetradebinaryoptions.com/pip-calculator/. 

Exchange Rate of currencies:

The exchange rate of currencies is the value in which the currencies are being bought and sold by the traders. The value can be known from different sources and used to determine the pip value.

For example, If you want to calculate the pip value of EUR/USD and your lot is of Mini size, multiply 0.0001( 1 pip) with 10000 ( lot size) and divide the whole by current exchange rate ( It is 1.12181 now ). The calculated pip value is 0.89141 .

2. Calculation through Apps/ Websites 

Calculation by the pip calculators is quite simple. You just need to enter the requirements, the pip value will be calculated and shown automatically. Some of the apps are FXTM (Forex Time Calculator), SafeTradeBinaryOptions, MyFxbook, CashBack Forex, XM Pip Value Calculator etc.


The traders tend to buy the currencies whose prices will probably increase. On the other hand, traders sell the currency whose price will fall. 

If the traders manage to buy the currencies before the price rises and sell them in raised amounts, they gain profit. And if you are one of those traders, then at some point you will have to calculate the pips value with a lot size.

Hope the above description will meet your inquiries and help you in making your trading strategies and decisions.