Foreign currency point value calculation

All currency pairs can be divided into three categories: positive price pairs (EUR/USD, GBP/USD) and reverse price pairs (USD/JPY, USD/CHF) and cross-exchange rate (GBP/CHF, EUR/JPY, etc ).

(For example, a standard account)

[Lot size] -- the number of each hand; [tick size] -- the number of beating points, for EUR/USD, It is 0.0001. (PIP) is "percentage in Point

 

(1) calculation formula for positive quotation and point value:

[Pip] = [lot size] × [tick size]

For a forward quotation, each vertex value remains unchanged and does not depend on the current quotation.

Example:

For EUR/USD, lot size is 100000 euro, tick-0.0001. Point value [Pip] = 100000*0.0001 = $10.00

For a combination of four currencies, including EUR/USD, GBP/USD, aud/USD and nzd/USD, the point value for each point is USD 10..

(2) For reverse quotation, the formula for calculating the point value is as follows:

[Pip] = [lot size] × [tick size]/[current quote]

[Current quote]-current quotation. The value of each point depends on the current quotation.

If it is related to yen, including USD/JPY, CAD/JPY, CHF/JPY, GBP/JPY. nzd/JPY, EUR/JPY, aud/JPY

Example 1:

For USD/JPY, the lot size is USD 100000, tick-0.01. Price: 129.20, USD/JPY: point value = 0.01*100000/USD/JPY = 1000/129 .20 = $7.74

(3) cross exchange rate:

[Pip] = [lot size] × [tick size] × [base quote]/[current quote]

[Base quote]-current quotation for basic foreign currency.

For example, for GBP/CHF, the lot size is 62500, the price is 2.3000, the basic foreign exchange price is GBP/usd1.4550, and the point value is 62500*0.0001*1.4550/2.3000 = $3.95.

Note: investors do not have to calculate the point value. They only need to remember the point value published by the dealer.