# Calculation of profit pips

Hi all,

may i know the correct way to calculate pips?

If we Enter: 142.53 and Exit: 147.11

i used calculator to calculate in this way:

147.11 - 142.53 = 4.58

so our profit is 45Pips?

458 pips. last decimal point is a pip…except for 5 digit brokers…then that’s a pipette.

Sorry what is a “pipette”?

A “pipette” is one-tenth of a pip. Whenever you see a price quoted in 5 decimal places, for example 1.62593, the fifth decimal place represents tenths of a pip (in this example, three-tenths of a pip).

If a price is quoted in 4 decimal places, for example 1.6259, then there are no tenths of a pip quoted. In this case, the last (fourth) decimal place represents pips (9 pips in this example).

Hope that helps.

Clint

In the example given in the first post, Buy at 142.53 and Sell at 147.11, the spread is automatically accounted for.

We [B]BUY AT THE ASK PRICE and SELL AT THE BID PRICE[/B]. Always. No exceptions.

Clint

This fractional pip pricing method allows traders to make profit from the smallest price movement, I don�t know if all brokers have it, but I think all should!

My broker acm has a glossary and a terminology section in their website, I think it would help you see that, since it looks like you are trying to do trades without having the theoretical part clear�
Good luck!

I was looking for the best way to answer this when I found the easiest sentence to help you remember:
A pip is the last decimal place of a quotation - If the EUR/USD moves from 1.2250 to 1.2251, that is ONE PIP.
This is the clearest explanation I could find, and it even helped me fix it better in my head 
I actually found it in the “school” tab of Baby Pips, there are short, very well-written lessons about all the basic (yet unmistakably confusing) terms of trading. I agree with Meagan about clearing up the theoretical part, When I first entered the forum I looked through it. It is always good to refresh our knowledge about those things!
And of course, as mentioned on a different thread I stumbled upon today � we are all newbies here.

On a different subject -
Pipette -
I have actually never stumbled across this phrase
I have seen 5 digit brokers before but never referred to it as a pipette!
it has a nice ring to it.

I knew that it was a pipette but I usually use the term �fractional pip� since my broker ACM calls it like that.

There are so newbies that think of forex as a market that you learn in a day, but you need experienced.
I think that first trades should be done in a demo and always in low vitality moments, gain experience and then turn things up a notch. When looking for a broker, look for a good costumer service, since you�ll need assistance a lot.