What is a one-pip move worth on your trade? The answer starts fixed and ends variable: fixed in the quote currency, variable in your account currency.
Pip value (quote ccy) = Lot size × 100,000 × Pip
Pip = 0.0001 | JPY pairs: 0.01
One standard lot = 100,000 units. Multiply by 0.0001 and you get 10 units per pip in the quote currency. On JPY pairs the pip is 0.01, so it becomes 1,000 yen. The last step is converting the result into your account currency — the only step that needs a live rate, which is why we ask you for it rather than using an old rate and calling it accurate.
Give EURUSD and GBPNZD the same value per pip and they are still not the same trade: EURUSD moves 48 pips on a median day, GBPNZD moves 123. The value is equal; the risk is not.
If your pip is worth $10 and your spread is 2 pips, you start the trade $20 down per lot. The liquidity page shows the current spread against the usual for the same hour.
Pip value is an input, not a decision. The decision is how much you lose if your stop is hit — and the position size calculator starts there.
The fifth decimal you see on your platform is a tenth of a pip. A spread that shows as "12" in five-decimal pricing means 1.2 pips — a common mistake that inflates your cost estimate tenfold.
For one standard lot (100,000 units), a pip is worth 10 units of the quote currency on pairs quoted to four decimals. If the quote currency is the US dollar, a pip is worth $10. On JPY pairs, quoted to two decimals, a pip is worth 1,000 yen per lot.
A pip is the fourth decimal on most pairs and the second on JPY pairs. The extra decimal that trading platforms display (the pipette) is a tenth of a pip, which is why a spread sometimes appears as a fractional figure such as 1.2 pips.
Because pip value is calculated first in the quote currency and then converted into your account currency. Pairs ending in USD have a fixed value of $10 per lot; the rest depend on the exchange rate between the quote currency and your account currency at the moment you calculate.
Other tools. Position size calculator · Forex liquidity and spreads