Point Value Calculation

All currency pairs can be divided into three categories — pairs with direct quote (EURUSD, GBPUSD), reverse quote pairs (USDJPY, USDCHF), and cross-rates (GBPCHF, EURJPY etc.).

For currency pairs with direct quote the point value measured in dollars is calculated with the formula
PIP = LOT_SIZE × TICK_SIZE

For currency pairs with direct quote the point value is constant and doesn't depend on the current quote.

Example:
For EURUSD the lot size is 100,000 Euro, tick size — 0.0001
PIP = 100,000 * 0.0001 = $10.00

For reverse quote pairs the point value measured in dollars is calculated with the formula
PIP = LOT_SIZE × TICK_SIZE / CURRENT_QUOTE

For reverse quote pairs the point value is changing depending on current quote.

Example:
For USDJPY the lot size is 100,000 US Dollars, tick size — 0.01. USDJPY quote is 114.66
PIP = 100,000 * 0.01 / 114.66 = $8.72

For cross-rates the point value measured in dollars is calculated with the formula
PIP = LOT_SIZE × TICK_SIZE × BASE_QUOTE / CURRENT_QUOTE,
where BASE_QUOTE — current quote of base (first) currency against US Dollar, CURRENT_QUOTE — current pair quote.

For cross-rates the point value is changing depending on current quotes of the pair and base currency.

Example:
For GBPJPY the lot size is 100,000 Pounds, tick size — 0.01, base currency — GBPUSD. GBPJPY quote is 230.82, and GBPUSD is 2.0107
PIP = 100,000 * 0.01 * 2.0107 / 230.82 = $8.71