What is a pip?
A pip is a standard unit used to measure movement in many currency pairs.
For most major currency pairs, one pip is commonly the fourth decimal place.
What is a lot?
A lot describes the size of a Forex position.
Different lot sizes create different levels of exposure and potential profit or loss.
- Standard lot: 100,000 units
- Mini lot: 10,000 units
- Micro lot: 1,000 units
Spread and commission
The spread is the difference between the buying price and the selling price.
A commission is a separate trading fee that may be charged by a broker.
Both spread and commission should be considered before entering a trade.
Learning reminder
This lesson is for educational purposes. Always understand the risks before using real money in financial markets.