IB has drop down to buy 1k, now 2k, 3k and so on of Eur/Usd. Can someone explain to me if I enter a buy order for 1k at say 1.087 and I’m filled, what is the value of each pip?
1 pip is the smallest possible jump (not counting pipette) of an exchange rate and equals 1/10000. If the exchange rate has changed from 1.1246 to 1.1247 we say that the change amounted to one pip.
Since the exchange rate represents the “price” of base currency in quote currency, pip value will be always denominated in quote currency.
To find pip value, for example, for AUDCAD you multiply your trading position (how much units of base currency you trade?) by 0.0001 and you get pip value in CAD. If you want to convert it to account currency (for example USD) you divide the pip value by the “price” of USD in CAD - USDCAD rate and get pip value in USD.