Quote currency
For EUR/GBP, GBP is the quote currency. A EUR 10,000 long with executed entry 0.8500 and exit 0.8510 produces GBP 10 of price P&L. At an assumed GBP/USD conversion rate of 1.2500, that is USD 12.50 before any additional charges.
What the rate measures
A rate in X/Y states units of Y per unit of X. The quote currency is not automatically USD, even if the reader uses a dollar account. A rise in EUR/GBP means EUR strengthens relative to GBP; it does not imply either currency rose against every third currency.
Where profit is first calculated
For a linear base-unit model, units multiplied by the executed price difference gives quote-currency price P&L. Pip value follows units multiplied by pip size. If the account uses another currency, apply the relevant conversion rate and charge rules; the booked amount can vary as that conversion rate changes.
Bid, Ask and inversion
Both sides of a compatible quote have the same units. If the quotation is inverted, base and quote swap and the new Bid is 1/old Ask. Multiplying or dividing by an exchange rate without tracking units can put the result in the wrong currency. Record quotation, position units and reporting currency beside every example.
FAQ
Is the quote currency always USD?
No. EUR/GBP quotes GBP, EUR/JPY quotes JPY and USD/CHF quotes CHF.
Does a USD account make every pip worth USD 10?
No. Position size, pip size and conversion determine its value.
