DEFINITION
Pip
The smallest standard price movement in a forex pair. For most pairs, 1 pip = 0.0001 (or 0.01 for JPY pairs). Position size × pip value = dollar P&L per pip move.
Read the full TILT guide on Pip →Related terms
Lot Size
The standardized volume unit for forex trades. A standard lot = 100,000 units. Mini lot = 10,000. Micro lot = 1,000. Lot size multiplied by pip value determines dollar risk per pip.
Leverage
The ratio of position size to account capital. A 1:100 leverage means a $1,000 account can control $100,000 of currency. Prop firms typically cap leverage at 1:30 to 1:100.
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