A question about calculating profit

[BoBo099]

So I was wondering about the profit on my demo account. Here is my trade information:

• Sell USD/JPY at price: 110.650
• Current Price: 110.578
• Size: 0.01
  So basically I gain 72 Pips.
  As I calculated, 1 Pip = $0.09. So I should gain $6.48.
  But in MT4, the profit shows that I gain only $0.65.
  What was wrong here? Thank you for reading! I really appreciate it.

[BoBo099]

This is the photo. Thank you!

[steve369]

I’m also trading this pair today on IC markets. My leverage is 100:1 and my lot size is 0.01. Which means at 110.553 entry and 110.549 currently, I profit by $0.04 in total.

So your calculation is incorrect, not IC markets.

[BoBo099]

@steve369

I’m also trading this pair today on IC markets. My leverage is 100:1 and my lot size is 0.01. Which means at 110.553 entry and 110.549 currently, I profit by $0.04 in total.

So your calculation is incorrect, not IC markets.

I see. But why is my calculation wrong? Could you please explain clearly? I really appreciate!
1 Pip = $0.09 > 72 Pips = $6.48. Am I missing something?

[darthdimsky]

You calculated the pip values to the 3rd decimal place. For JPY pairs it’s to the 2nd decimal place. So you gained 7.2 pips. When you correct this, your math will line up with what your broker provided.

For more details you can find how it’s calculated here:

What is a Pip in Forex?

[BoBo099]

@darthdimsky

You calculated the pip values to the 3rd decimal place. For JPY pairs it’s to the 2nd decimal place. So you gained 7.2 pips. When you correct this, your math will line up with what your broker provided.

For more details you can find how it’s calculated here:

Oh, I see what I was wrong here. Thank you very much!
But why the MT4 shows 72 Pips? It’s really confusing.

[darthdimsky]

@BoBo099

But why the MT4 shows 72 Pips? It’s really confusing.

You mean in points? like this?

You’ll notice how it reads the value in points, not pips. Atleast for MT4/5 platforms, points for JP pairs are listed to 3 decimal places and non JPY to 5 decimal places. Pips are not equal to points.

After executing a few trades you get used to it and your mind adapts automatically though

[BoBo099]

@darthdimsky

You mean in points? like this?

You’ll notice how it reads the value in points, not pips. Atleast for MT4/5 platforms, points for JP pairs are listed to 3 decimal places and non JPY to 5 decimal places. Pips <> points.

After executing a few trades you get used to it and your mind adapts automatically though

I understand! Thank you for your time! It helps me a lot, I really appreciate it!

[steve369]

https://get.exness.help/hc/en-us/articles/360015522299-What-is-the-difference-between-Pip-and-Point-

[CraigForex2020]

Great link so many get confused over this handy to have it clearly explained

[BoBo099]

I got it. Thank you!
I have never read about the Point definition on babypips before, so when I changed the profit’s display from “as deposit currency” to “as points”, I thought that was the Pips.

[darthdimsky]

The BP course refers to it as a “pipette”. So 1 point = 1 pipette.

[Jungletrader]

That explains it quite well .
Can be a sticking point , pardon the pun , for new traders

[Raihan98]

Apologies, i would like to enquire how do you calculate profits/loss.

So this is how my breakdown for my trade

1. decide on risk % per trade in accordance to account balance
2. entry + exit target
3. value per pip
4. afterwards with value per pip i used it for position size

However one thing that doesnt tally is my profit & loss

as far as i know i calculate my projected profits = value per pip x pip difference (exit - entry)

may i know how do you calculate profits? thanks!