Pip value is what a one-pip price move is worth in your account currency for a given trade size. On a standard lot of a four-decimal pair, one pip is about $10 when your account and the quote currency are both USD. Everything else is a variation on that single idea.
The core formula
A pip is the smallest standard price increment. On most pairs it is the fourth decimal place, 0.0001. To find its value, multiply that by your position size in units:
Pip value = pip in decimals x units traded, converted to your account currency
If you are unsure what a pip even is, start with what is a pip and come back - the value calculation builds directly on that definition.
Case 1: USD is the quote currency (EUR/USD)
For EUR/USD a pip is 0.0001. On a standard lot of 100,000 units: 0.0001 x 100,000 = 10 USD per pip. Because the quote currency is already USD, no conversion is needed. A mini lot is $1 per pip and a micro lot is $0.10 per pip.
Case 2: USD is the base currency (USD/CAD)
Here the pip is measured in CAD, so you divide by the exchange rate to bring it back to USD. On a standard lot: 0.0001 x 100,000 = 10 CAD, then 10 / USD-CAD rate. At a rate of 1.35, that is about 7.41 USD per pip. As the rate moves, the dollar value drifts slightly.
Case 3: JPY pairs (USD/JPY)
Yen pairs are quoted to two decimals, so a pip is 0.01, not 0.0001. On a standard lot: 0.01 x 100,000 = 1,000 JPY per pip, then divide by the USD/JPY rate. At 150, that is about 6.67 USD per pip.
Important: pip value is per lot. Once you know it, sizing a trade is one more step: divide your dollar risk by (stop distance in pips x pip value) to get the exact lot. That is covered in lot size from stop loss.
Do you have to do this by hand?
Knowing the formula makes you a better trader, but you rarely need to run it manually. Trading platforms and backtesting tools with auto lot-sizing convert pip value and compute position size for you. You set the risk and the stop; the software does the conversion at the current rate. Understanding the math just means you can sanity-check what the tool gives you.
See pip value working live
When you backtest trades in a simulator, each pip of movement is translated straight into dollars on your position, so you watch pip value in action bar by bar. That feedback loop turns the abstract formula into an instinct for how far a trade has to move to hit your target or stop.
Pip value FAQ
How do you calculate pip value?
Multiply one pip in decimals (0.0001, or 0.01 for JPY pairs) by the units traded, then convert to your account currency. A standard lot on EUR/USD is 0.0001 x 100,000 = $10 per pip.
Why is pip value different on some pairs?
The pip is measured in the quote currency. When that is not your account currency, you convert at the live rate, so the value drifts. JPY pairs also use two decimals, shifting where the pip sits.
Do I need to calculate pip value manually?
It helps to understand it, but platforms and backtesting tools compute pip value and position size automatically from your risk and stop distance.