Learn the Lingo (Units of Meaure)

All these units of measure in markets. It's ridiculous. Of course in equity markets it's relatively easy. Everything trades in dollars and cents. What about all these other things though?

Pip - FX pips are the smallest unit of measure in FX. If we're quoting yen at 129.52 and it moves 0.22 yen, that's 22 pips. If we're quoting New Zealand dollars at .7805 and it moves 0.0025 that's 25 pips.

Big Figure - A "big figure" in FX is a hundred pips. So if we're quoting yen at 129.53 and it moves 1 yen, that's one big figure. If we're quoting New Zealand dollars at .7805 and it moves .01, that's a big figure.

Tick - ticks are more flexible. They are the general term for a basic move. A tick in bonds is one 32nd. A tick in commodities is usually a .01 move in the contract. It's worth noting that a lot of these aren't straight dollar values though. A silver contract that moves .01 (one tick) is not worth the same as an oil contract that moves .01 (one tick). The best way to look these up is via Bloomberg. The DES page will tell you the value of a one tick move. For US government bonds, for example, a one tick move is worth $312.50.

Par - 100, face value of a bond

plus - a plus is bond-speak for half a 32nd. So 98-24+ means 98 and twenty-four and a half thirty seconds. Some bonds trade in eighths of a tick (so eighths of a thirty-second. . .yes, that's a 256th, but don't think about it that way).

the figure - The figure refers to the exact amount. So "ninety-four the figure" means 94-00. In FX the figure means 00 pips.

cab - cab is a fourth (much like a plus is a half). Used in bonds sometimes as well as other derivatives.

even - even can mean zero or the figure. A switch being quoted at even means the front tenor and back tenor are the same rate (in a rate switch for instance, see "Learn the Lingo (Rates)" if this is confusing) so there is zero slope.

There are many more, but this will do for now.