I just don’t get it. I’ve tried to understand it but it doesn’t stop. People constantly mentioning how many pips they made in a trade rather than a percentage. The amount of pips made seems meaningless other than that you were able to get ‘x’ amount. If I made 500 pips in one day, and by doing so increased my account by .01%, then what does that really mean? It means nothing. Anybody can make 500 pips or 1000 pips, or even 2000 pips in a week. Just make a really small (.001 micro lot size trade and let it run). Why do people insist on guaging their performance by the amount of pips they make rather than a standardized measurement such as percentage.
Umm, it’s probably convention more than anything, if I said I made 50% today on the GBP, it wouldn’t mean anything to you, but 50 PIPS would, the 50% would mean something to me though, and you have the money management that comes into it also.
So I guess pips is the common denominator, I get between 5 and 20 PIPS a week, percentage wise about 1% - 10% per week.
I prefer if people give results in r/r ratio.
Pips sound so much more impressive than returns. I’m totally in agreement, though. They are pretty useless for comparative discussion. They really are only relevant when looking at very comparable strategies and/or talking about how much of a price move one got. For example, saying you pulled 150 pips out of cable today means something because people have a point of reference. They can look at the chart and know whether that was a good day"s work or not. If you’re talking trading performance over time, though, it needs to be returns in conjuction with an indication of risk.
Anybody can make 500 pips or 1000 pips, or even 2000 pips in a week
:eek:
It’s easier to measure success/failure in pips. Everyone has different capital and how much they trade/pip
Although I think consistent % return and profitability is a better measure
win rate, risk/reward and account growth % is what matters.
Pip count is the newbies way of having a pissing contest and it’s completely meaningless.
So succinctly put! 
And don’t forget the compounding - I wouldn’t be here without compounding i.e. Profits on Profits.
I used to get 332,456 PIPS a week but it was just too much money.
I agree that some form of standard measure would be good, but as already mentioned pips are a common denominator that we can all use and they scale the same no matter whether we are trading micro or standard lots. They also allow direct comparison if you took the same trade or follow the same currency pair.
Using a percentage of your account as a basis sounds good in theory, but was the percentage made on a big move with no leverage or a 5 pip scalp at 100:1. :rolleyes: Just have a look at some of the percentage gains on accounts at myfxbook to see evidence of that.
I have found since I’ve switched from displaying dollars to displaying pips on my trading platform it has taken some of the pressure off in my trading as it allows me to focus on the trade not the profit/loss hitting my account.
We are all looking to find evidence of others actually making money in this game as a justification for putting the time in that we do, especially when we’re suffering losses. The best thing we can do is focus on our own trading without trying to compare ourselves to others as everyone has their own trading personality and style.
People can be selective in what they tell you anyway. I’ve known a few guys who bet on the horses and they would always triumphantly tell me when they’d won and how much, but never when they’d lost or how much.
Anyway, that’s my just my thoughts on it. 
I agree that some form of standard measure would be good, but as already mentioned pips are a common denominator that we can all use and they scale the same no matter whether we are trading micro or standard lots. They also allow direct comparison if you took the same trade or follow the same currency pair.
This is why it just is that way, wherever you go people will gauge success/failure in pip counts. Even the old timers.
The reason pips are meaningless is this:
Two people, each got 500 pips in profit.
Person A had an initial stop loss of 20 pips.
Person B had an initial stop loss of 2000 pips.
It’s easy to see who the better trader is and who the talker is.
Pips sound all well and good until you realize that you could have made 10% on your account on a 100 pip gain, but lost 20% on a 20 pip loss because your risk management was lacking (to put it kindly). No hedge fund manager, chief dealer, or anyone else looking to gauge your performance is going to look at anything but your returns (generally risk-adjusted).
Pips is the only way for traders to discuss trades that has any real meaning, people have different types of accounts some trade micro accounts some trade standard accounts some trade different lot sizes, some have different leverage.
If I am talking to another trader and I tell him I made 100 pips on EUR/USD this morning he knows exactly what I mean.
If i tell him I made 0.028% of my account balance on EUR/USD this morning that doesnt tell him anything about how good a trade I had.
or if I was trading a standard account 10k lots and I trade 1 lot I might make 100 pips = $100
The next guy might be trading a micro account 1k lots and traded 0.1 lots but he had an astronomical day and made 10,000 pips but still only = $100
Its not irrelevant if the trader states the risk per trade.
A few pips and compounding.
That strategy sounds familiar, may i ask how you learned/perfected it?
Exactly…
I agree with everything you said except this. 0.028% does tell a lot about how good a trade you made (in that case not very). The percentage factors everything in. For traders who are consistent and have been at it for a while, percentage is a much better representation of achievement. If your r/r is bad and you have bad money management, then obviously the “for traders who are consistent” doesn’t apply to you because you will be gone soon enough. But I’m talking about people who talk frequently about their performance like “yesterday I did this” and “a week ago I did this.” I’m only mentioning it here on the forums because I presume that everybody here is a little dedicated at the very least to be good traders.
Helooooo everyone. The only thing that matters is your certified live Blotter, and account statements. Cash is what counts not 8 gazillion pips or whatever. But there are soooo many factors involved in efficient trading that I think everyone just boils it down to Pip’s. Many of these were mentioned so far in this discussion, and there are even more. Vendors love to talk in Pips, Ticks and Points, why? Because the trades are theoretical, not real, if they really wanted to impress they would put their statement right on the front page of the website.
Now it is all well and good that folks post this way of trading or that, Tymen and ICT have done a fine job in teaching, for free. But the minute anyone starts asking for money, in any form, including donations or website membership, at that point you need to put them on the hot seat and ask to see an audited statement of a live account, even if it is a 1k mini account, if the method is viable they will be profitable.
I know that some of what I said here is a little off topic, but I think it kinda sorta applies 
The Ever Bound By NDA’s And Fiduciary Responsibilities VIPER
Aside from the fact that pip count is the only way to describe a trade so that all traders know what it means, also take into account not everyone wishes to reveal to the whole world their account balance and the amount of money they have and to discuss their trades in dollar amounts and percentages would reveal exactly that.
The answer is R-multiples. or your profit relative to the amount you risked on the trade. ideally you would risk the same account % (ie 2%) per trade, called ‘R’, and you could use that to compare trading performance for yourself over many trades, or for trader-to-trader comparisons.
If you make 5R on a trade, that means your profit is 5 times that of the loss you would have incurred from your stop loss being hit. Then take the average of R over many trades and you’ve got yourself an expectency for your trading method/system 
Pips has to be coupled with lot size, to yield pip value. You can make 10 pips a week, but on a standard lot, that’s about $100. Another person can make 1000 pips, but on a nanolot, which is much less.