Fractional pips and what "a pip" means on your platform

[Shadow Trader]

Five-digit pricing, where EURUSD quotes to 1.08523, introduced the pipette, a tenth of a pip. Platforms differ in how they present this, and it creates a lot of confusion.

A stop of 10 on MT4 might mean 10 points, which is 1 pip on a five-digit pair. Some scripts and EAs treat inputs as pips and others as points. A setting of "stop loss 5" could therefore mean 0.5 pips or 5 pips depending on the code.

The same applies to spread figures. A spread of 12 shown in the market watch on some platforms is 1.2 pips. On others the number is shown with a decimal.

Scalpers working with targets of 2 or 3 pips are particularly exposed to the confusion. A mistake of a factor of ten means an order with a 0.2 pip target, which can't be filled given the spread, or a 20 pip stop on a system designed for 2.

Whenever a new EA or indicator is installed, a check on a demo account of what the inputs actually do avoids the mix-up. Place a trade and look at the resulting stop and target levels.

Symbols like USDJPY, with three digits, and metals with two, add further variation.

Which unit confusion has caught you out, and in what setting?