Question: What's the "pip value" of commodity CFDs on MT4 (MetaTrader4)? How to calculate it?
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It is not so common to measure the price movement of CFDs with pips, but normally Forex brokers measures them with “Ticks”.
“Tick” is simply the smallest value the price can change in the market, and there are tick sizes for all CFD symbols.
For commodity CFDs, here are the tick sizes:
| Coffee | 0.05 |
|---|---|
| Copper | 0.0005 |
| Corn | 0.25 |
| Palladium | 0.05 |
| Platinum | 0.1 |
| Sugar | 0.01 |
| Wheat | 0.25 |
You can find the full details of contract specification in the official website.
And there are price value for each “Tick”, which is called as “Tick Value”.
“Tick Value” is the value how much changes when the market price changes one tick.
| Coffee | $18.75 |
|---|---|
| Copper | $12.50 |
| Corn | $12.50 |
| Palladium | $5 |
| Platinum | $5 |
| Sugar | $11.20 |
| Wheat | $12.50 |
When you have an open position of 1 lot of a commodity CFD, then there is one tick price movement, then you have made a profit/loss of the above amount.
One pip value doesn’t really affect margin requirements on MT4 though, it is a important factor when you calculate profit/loss.
If you are not sure about how to calculate profit/loss or tick value/size, then you are recommended to open a Demo account and try out with the virtual numbers.
