Tick

What is a Tick in Trading?

A tick is the smallest possible price movement an instrument can make on your trading platform. If you’ve wondered what is a tick in trading, think of it as the platform’s minimum step in price. Traders use trading ticks to size entries, stops, and targets.

Example

• Tick size: 0.00001 (the smallest step the price can move).
• 1 tick move: 1.10201 → 1.10202 (up by 0.00001).
• 10 tick move: 1.10201 → 1.10211 (up by 0.00010).
• Money impact: Each tick is worth a small amount called the tick value. It depends on your lot size (contract size).
• Example: if 1 tick = 1 Dollar per lot, then 10 ticks = 10 Dollars per lot.

You can find the tick value for each symbol in your platform’s contract specifications.

Ticks vs Pips (Quick Conversion)

• Tick: smallest price step (platform-defined).
• Pip: The standard forex unit is 0.00010 on five‑decimal pairs.
• On EURUSD: 1 pip = 10 ticks. This ticks vs pips link helps when planning risk and targets.

Why Ticks Matter

• Precision: Set tight stop losses or small take‑profit targets in exact tick counts.
• Costs: Spreads are often measured in ticks; knowing tick size helps you judge trade costs.
• Slippage: Fills can differ by a few ticks in fast markets; key for trading slippage awareness.

Tick Charts

Unlike time-based charts, a tick chart creates a new bar after a set number of ticks (e.g., every 100 trades/quotes), not after a set time. In busy periods, you’ll see more bars; in quiet periods, fewer. Many short‑term traders look at a forex tick chart example to monitor quick moves in pairs quoted in dollars, euros, or Yen.