Forex PIPs

Knowledge of Forex PIPs is extremely important for calculating profit and loss in Forex online trading. Forex PIP is the abbreviation for percentage in point. It is the smallest unit of percentage increase or decrease in price for the currency. Last decimal point in exchange value of currency pair is signified as pip. If you bought USD (United States Dollar) for CHF (Swiss Frank) at 1.2475 and sold it for 1.2489, then you made 14 pips. However, the PIPs system is not same in case of USD/JPY. The decimals in ratio of USD/JPY are of only two points.