Fractional Pip Pricing
- FXCM offers prices in tenths of a pip which should provide lower spreads for popular currency pairs.
- The digit representing a tenth of a pip appears to the right of the two large, bold-faced digits.
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Fractional pip pricing should reduce bid/ask spreads for each of the more popular currency pairs. Our aim is to provide you with very competitive transaction costsâtight bid/ask spreads on every currency pair.
Access to Better Spreads
As a Forex Dealer Member with strong relationships with many liquidity providers (which include global banks, financial institutions, prime brokers and other market makers), we constantly press them to supply the most favorable prices to us. We then pass these prices on to you, with a small markup, which is how FXCM is compensated. FXCM may also be compensated for order flow.
Liquidity providers now provide streaming six-digit prices to FXCM; and consequently we are delighted to provide more accurate, tighter prices to you. As competition intensifies, fractional pip pricing should reduce bid/ask spreads for each of the more popular currency pairs even further—welcome news indeed in view of the market volatility we have recently experienced. Before this change, the buy price was rounded up to the nearest pip, and the sell price was rounded down. Now, with the additional decimal place, you will see a more accurate—and usually tighter-spread. For instance, you might see a buy price of 1.34557 instead of 1.3456 and a sell price of 1.34532 instead of 1.3453. In this case, you would have a spread of 2.5 pips instead of 3.
P/L in Pips Now Quoted Fractionally
On your Open and Closed Positions on the FX Trading Station, your P/L will now show tenths of a pip.
For more information, please call us at 0808 234 8789.