Point equivalent is calculated with the account size or traded size?
Need help from experts. Thank you for your answers. (point=pip)
Q: I have a mini account, so one lot (1.0) is 10000 units. If I trade 0.01 lot i.e. 100 units of EUR/USD pair, and the pair is quoted with five points after decimal i.e. x.xxxxx
Then by formula, one point equivalent of profit or loss will be = Total Units Traded/Decimals in Quote
My question is, will the "total units traded" be 10000 (account size) or 100 (traded size) in this case?
If it was 10000, then one point will be 0.1 USD
If it was 100, then one point will be 0.001 USD
look at it this way......
a normal lot 1.0 = $100,000 = $10 per pip
1 pip = 0.0001 note 4 decimals
so if you trade mini ie: $10,000 per lot then 1 pip = $10 / 10 = $1 per pip
so 100 lots on mini = $1 * 100 lots = $100 per pip
if you wanted to calculate the 5th decimal value then.
Normal 1.0 = $10 per pip / 10 = $1 per 5th decimal
Mini 1.0 lot = $1 per pip / 10 = $0.10 per 5th decimal
Mini 100 lot therefore = $10 per 5th decimal
100 and just to add, there are any number of online pip calculators which can give you the value (in case you are still having trouble)
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