Fractional pips, also known as ‘pippettes’, refer to the fifth decimal place seen in some Forex price quotes.
The highlighted numbers in these example price quotes are the fractional pips: 1.08564/1.08569
Most currency prices are traditionally displayed to the fourth decimal only, with the exception of the Yen which is to two decimal places.
Vantage FX uses the fractional pip as a means for greater transparency and price competition. As our spreads are very tight, the differential is only visible/ measurable with the fifth decimal. Vantage FX’s MetaTrader 4 (MT4) Trading Platform displays all quotes with the fifth decimal place for improved precision.
The fractional pip is worth 1/10 pip.
Please read on to see how the pip movement is calculated with fifth decimal quotation.