Understanding trading contracts and pip values

waxon83

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Hi people,

As Im quite new to all this I was wondering if any of you could help me undertand trading contracts and pip values.

If I had $100,000 total pot and each trade I wanted to risk $1000, would every pip of that $1000 be worth $0.10 cents?

I believe $100,000 is worth 1 contract so would $1000 be a mini contract and is a mini contract any different apart from the size?

Hope you can help,

Thanx.
 
The way to look at this is to determine the size of the stop you wish to use, then to adjust the position size to ensure that the loss wouldnt exceed say 1% of your account.

Lets assume that you had $100,000. So risking $1000 represents 1% of your account. There are an infinate number of ways you could lose the $1000.

You could open a trade with a position of 1 standard lot ($10 a pip). That would allow you to use a stop of 100 pips. Alternatively you could open a position with 10 standard lots ($100 a pip) and that would allow you to use a stop of only 10 pips. A trade with a position size of a mini lot ($1 a pip) would allow the use of a thousand pip stop loss etc,
 
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