What is a pip?

One pip is the smallest unit of change in price.
It stands for ‘percentage in point’. Because most currency pairs are quoted with four

What is a spread?

When looking to trade a currency there are always two prices. On the currency table
(from the previous page) the price you can buy for is on the right side and is called the
ask or the buy price. The price you can sell at is on the left side and is called the bid or
the sell price. Remember when you buy a pair you are buying the base currency and
selling the counter and when you sell a pair you are selling the base and buying the counter.
The difference between these two prices is decimal points, one pip usually equals 0.0001
but there are some currency pairs such as the USD/JPY where 1 pip equals 0.01.

called the spread, which is the difference between what you pay to buy a currency to what you
get when you sell it. The spread is essentially the cost of your trading. You may come across brokers
advertising low spreads but be sure to check what other commissions and costs they may
be charging you. With easy-forex you only pay the spread.

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