Forex Made Simple by Kel Butcher

Author:Kel Butcher
Language: eng
Format: epub, pdf
Publisher: John Wiley & Sons, Ltd.
Published: 2011-02-22T05:00:00+00:00

Fractional pips

A recent development by some retail forex dealing firms has been the introduction of fractional pips, by adding another digit onto the currency pairs — either a fifth digit for most currencies or a third digit for pairs involving the Japanese yen. This is not a whole pip, but one that is one-tenth the value of a whole pip. Fractional pips have long been available in the inter-bank market.

Tip

The availability of fractional pips serves to narrow the spread between the bid and the ask.

Figure 5.2 shows a quote of EUR/USD with fractional pips.

Figure 5.2: EUR/USD with fractional pips quoted

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