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Fractional Pips
By Tim Shea | September 21, 2007
If you trade either demo or live with FXCM, you’ve probably noticed an extra digit in your prices, recently. That’s because we’ve just started quoting prices out to a further digit. So, now, instead of seeing a EUR/USD price of, say, 1.3587, you’ll see a price of 1.35874. I’m so used to seeing prices only quoted in pips, and not tenths of a pip, that it’s been a little tough to adjust. But, believe me, this is great.
Why? Lower prices! Since FXCM has started fractional pips, I’ve seen tighter spreads most of the time. Like right now, it’s early afternoon in
Tags: forex, forex trdaing, fractional pips, fxcm, pips
Topics: What To Look At In The Market | 2 Comments »
September 23rd, 2007 at 6:18 am
Adding the another digits usually cause confusion especially when you want to open position. Sometimes you set it up right cause there are extra digits. I dont understand why brokers now a days like to add the digit when the significant of it almost nothing.
What is it for anyway?
September 26th, 2007 at 8:37 am
A number of brokers (though not all) have added the extra digit to become more competitive. Fractional pips allow FXCM to offer clients tighter spreads. Tighter equals lower-cost trading. Like in my example, I saved enough money to buy a sandwich. I don’t that’s an insignificant amount. If I were trading in much larger amounts, my savings would be even greater.
-Tim Shea