Every trader actively trading in the foreign exchange market needs to know his pips and a pip calculator comes in handy for doing exactly this. For those who are trading in the same currency as their trading accounts, it would be quite simple to make their pip calculations. But, those who are trading in other currencies would have additional steps to make in their calculations. The process of computing for pips and spreads would also be more complicated for those who are holding on to more than one currency pair. Using a pip calculator definitely serves to make it much more convenient and hassle free to get pip values without manually punching in each figure on a trader’s trusty financial calculator.
It is easy to use a pip calculator – even the most inexperienced of traders would be able to get his pip values using this tool without much hassle. Simply entering a particular currency pair into the calculator will return the US dollar pip value for forex traders. There are calculators that offer conversion facilities for those with trading accounts in other currencies as well. Usually, these calculators give pip values based on the minimum lot sizes of the various forex trading accounts. Minimum amounts per lot are set at various amounts depending on the kind of trading account a forex trader has. Standard lots are set at a minimum size of $100,000. Smaller minimum amounts are set for mini accounts and micro accounts but the value per pip remains the same – $10 per pip for every $100,000 lot for USD currencies.
Forex traders need not bring out their financial calculators to manually punch in their figures culled from their online trading system or from any other source giving them live currency prices. A pip calculator will be able to do all the computations for the forex trader using live currency price information automatically generated from the exchanges around the world. Looking for these online calculators is as easy as looking for anything on the internet – the search box will return a number of options in online forex calculators. The best thing about this tool is that it is available for free. In fact, those who choose to purchase their own forex systems would probably find this facility available and bundled into their system already.
There is no specific limit to how much or how little time a forex trader needs to spend with his choice of pip calculator. He can use it just before implementing a trade to validate his decision with respect to the gains he stands to collect from the trade. Or, he can opt to tinker with it on his down time while figuring out what to do with his currency pairs. Regardless of how a forex trader uses his pip calculator, the information that he will get from running his calculations online will give him a good idea of how sound his position is and of how he is supposed to manage his position to gain more profits and to minimize his losses. Since using this tool is free, he does not really stand to lose anything by running his calculations online.