Need help calculating pips for gold

Hi guys, I intend to start trading gold, but could anyone be kind enough to explain how to calculate its pips?

Oh I forgot to mention I am trading the XAU/USD combo

H
@headies25284 - 1 month ago

Pls can you be more clearer with your question.

Okay, like from my screenshot the spread on xauusd is 0.4 pips but what is the USD value of this 0.4 pips when trading 0.1 lot size?

H
@headies25284 - 1 month ago
Quoted - headies25284

4dollar is the answer. I will help you with the calculation.

Gold contract size

1.0 lot = 100 oz

0.1 lot = 10 oz

Spread cost formula

Spread cost = Spread × Ounces

spread is 0.4

So:

Spread cost = 0.40 × 10

Spread cost = $4.00

The 0.40 spread on XAUUSD at 0.1 lot = $4.00 cost.

This means when you open a 0.1-lot gold trade, you start the trade –$4 because of the spread.