Forex Terms Every Beginner Should Know

What is a pip?

A pip is the smallest unit of price movement in forex. For most currency pairs, one pip = 0.0001 (one ten-thousandth).

Example: EUR/USD moves from 1.0950 to 1.0951 = one pip of movement.

What is the spread?

The spread is the difference between the buy price (ask) and sell price (bid). It is how brokers make money—and it costs you on every trade.

Tighter spreads = less cost to you. TAG Markets has competitive spreads on major pairs.

What is leverage?

Leverage lets you control large amounts with small capital. 24x leverage means your $10 deposit controls $240 in trades.

Gain: If the market moves 1% in your favor, you gain 24%. Loss: If it moves 1% against you, you lose 24%.

What is margin?

Margin is the amount of capital required to open a position. At 24x leverage, you need 4.17% of the trade size as margin.

Example: To control $240, you need $10 margin.

What is a lot?

A lot is the standard size of a forex contract. 1 standard lot = 100,000 units of the base currency.

On TAG Markets, you trade micro-lots (1,000 units) and mini-lots (10,000 units) to keep position sizes manageable.

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