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Point, revisited

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Terrence Brannon
204
Terrence Brannon  

In this earlier thread we were told that a point was 1/10th of a pip.

However, in the MQL4 book, we read:

It can be easily seen that, in this case, the broker offers a spread of 2 points. 

 However, I would say that this is a 4-digit broker where the spread is 2 pips or 20 points (not 2 as the text said).

Ubzen
5394
Ubzen  
Whats important is that you understand the difference :)
Tjipke de Vries
6370
Tjipke de Vries  
princepawn:

In this earlier thread we were told that a point was 1/10th of a pip.

However, in the MQL4 book, we read:

 However, I would say that this is a 4-digit broker where the spread is 2 pips or 20 points (not 2 as the text said).

 

 

 


On a 4 digit broker a point has value equal as pip

only at 5 digit brokers a pip is 10 points

the moment the MQL4 book  was written there was no 5 digit notation broker

Alain Verleyen
Moderator
32372
Alain Verleyen  
princepawn:

In this earlier thread we were told that a point was 1/10th of a pip.

However, in the MQL4 book, we read:

 However, I would say that this is a 4-digit broker where the spread is 2 pips or 20 points (not 2 as the text said).

You are wrong, as deVries said for a 4-digit broker a pip as a point. So for EURUSD, "the spread is 2 pips or 2 points", a point is 0.0001. Beware to not confound with ticksize.
Ian Flanagan
549
Ian Flanagan  

Yeh, so a pip is the lowest noticeable change in the 'forex tradition', i.e. in most major currency pairs a  pip is 0.0001 except for xxxJPY where a pip is 0.01 etc.

A point is the lowest noticable change on your broker chooses shows you on your software.

 

There is not necessarily any link between the two but generally it is 0.00001 for major pairs and 0.001 for xxxJPY, just because it's handy.. but it's not a rigid definition. 

Simon Gniadkowski
Moderator
18023
Simon Gniadkowski  
alladir:

Yeh, so a pip is the lowest noticeable change in the 'forex tradition', i.e. in most major currency pairs a  pip is 0.0001 except for xxxJPY where a pip is 0.01 etc.

A point is the lowest noticable change on your broker chooses shows you on your software.

Actually I think that is wrong . . . a point is the value of the last decimal value shown for the symbol.  The smallest increment of change for the symbol is MODE_TICKSIZE
whroeder1
15554
whroeder1  
angevoyageur:
You are wrong, as deVries said for a 4-digit broker a pip as a point. So for EURUSD, "the spread is 2 pips or 2 points", a point is 0.0001. Beware to not confound with ticksize.
No he is not. Doesn't matter whether the broker is 4 digits or 5 digits. A pip is a pip. 0.0001 is one pip (1 point) 0.00010 is also one pip (10 points) Is 0.0001 not equal to 0.00010?
Ian Flanagan
549
Ian Flanagan  
RaptorUK:
Actually I think that is wrong . . . a point is the value of the last decimal value shown for the symbol.  The smallest increment of change for the symbol is MODE_TICKSIZE


It's MODE_TICKSIZE the value of a point change in the deposit currency?

I mean the smallest incremental change in price. 

WHRoeder:
No he is not. Doesn't matter whether the broker is 4 digits or 5 digits. A pip is a pip. 0.0001 is one pip (1 point) 0.00010 is also one pip (10 points) Is 0.0001 not equal to 0.00010?

I take a point to be the lowest possible change in price shown by the broker.. isn't this is also the value of MarketInfo(symbol,MODE_POINT) ? For a 4 digit broker it would be 0.0001 (1 pip), for a 5 digit broker it would be 0.00001 (1/10th of a pip).

Also I've seen two ostensibly 5 digit brokers who treat a certain cross currency differencly, one broker gives it 4 digits and one gives it 5, so this can't be an absolute rule, it's just whatever the broker decides.

If some crazy broker wanted to, a point could be a thousand pips. 

Simon Gniadkowski
Moderator
18023
Simon Gniadkowski  
alladir:

It's MODE_TICKSIZE the value of a point change in the deposit currency?

I mean the smallest incremental change in price. 

MODE_TICKVALUE is the value of a point in the deposit currency.  The smallest increment in change of price is MODE_TICKSIZE . . .  for example take a look at some of the indices.
Ian Flanagan
549
Ian Flanagan  
RaptorUK:
MODE_TICKVALUE is the value of a point in the deposit currency.  The smallest increment in change of price is MODE_TICKSIZE . . .  for example take a look at some of the indices.


Eh, hehe, isn't TICKSIZE the price of a point in quote currency?

If the price is 0.12345, the smallest incremental change in price (a point) is 0.00001 right? neither ticksize of tickvalue have anything to do with it.

 (apart from a 0.00001 change for 1 lot is worth MODE_TICKSIZE in the quote currency (generally 1 for major pairs, and 100 for xxxJPY), and worth MODE_TICKVALUE in the deposit currency.)

Simon Gniadkowski
Moderator
18023
Simon Gniadkowski  
alladir:


Eh, hehe, isn't TICKSIZE the price of a point in quote currency?

If the price is 0.12345, the smallest incremental change in price (a point) is 0.00001 right? neither ticksize of tickvalue have anything to do with it.

 (apart from a 0.00001 change for 1 lot is worth MODE_TICKSIZE in the quote currency (generally 1 for major pairs, and 100 for xxxJPY), and worth MODE_TICKVALUE in the deposit currency.)

MODE_TICKSIZE17Tick size in points.

 

Nope . . . as I said . . 

RaptorUK:
MODE_TICKVALUE is the value of a point in the deposit currency.  The smallest increment in change of price is MODE_TICKSIZE . . .  for example take a look at some of the indices.


 

You can see here that point is 0.1  but the smallest increment that price moves by is 0.5 which is TickSize 

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