Forex

Starting forex: pair, pip, lot, spread

Four ideas you need to read any forex quote.

Currency pair

In EUR/USD the euro is the base and the dollar is the quote. A price of 1.0850 means one euro costs 1.0850 dollars. Buying the pair means buying the base currency and selling the quote.

Pip and lot

A pip is the standard price step: 0.0001 for most pairs, 0.01 for yen pairs. A standard lot is 100,000 units of the base currency. For EUR/USD one pip on one lot is worth about $10; a mini lot about $1.

Spread and sessions

The spread is the gap between the buy and sell price and is part of the trade cost. Volatility and volume are usually higher at the London and New York opens, especially when they overlap.

First steps

Choose a regulated broker and start with a demo account.

Size positions from risk, not from a wish to "earn more".

Remember that leverage magnifies losses too.

Related terms

Where to trade

FxProFxPro

Broker: forex and CFDs.

Sign up with FxPro ↗
VantageVantage

Broker: forex and CFDs.

Sign up with Vantage ↗

Referral link: ARUT may receive a reward. Trading with leverage carries a high risk of losing funds; this is not investment advice. CFDs are complex instruments: because of leverage there is a high risk of losing money quickly.