Pip Value & Contract Specifications
Silver (XAG/USD) has a contract size of 5,000 troy ounces per standard lot — fifty times larger than gold's 100 oz. One pip = $0.01 (one cent of silver price movement). With 5,000 oz per lot, the pip value is $50.00 per standard lot. This is by far the largest per-pip dollar value of any mainstream retail trading instrument, making position sizing critically important.
| Lot Size | Contract (oz) | Pip value (USD) | Pip value (ZAR @ 18.50) | 20-pip stop loss |
|---|---|---|---|---|
| 0.01 (micro) | 50 | $0.50 | R9.25 | ~R185 |
| 0.10 (mini) | 500 | $5.00 | R92.50 | ~R1,850 |
| 0.50 | 2,500 | $25.00 | R462.50 | ~R9,250 |
| 1.00 (standard) | 5,000 | $50.00 | R925.00 | ~R18,500 |
ZAR values illustrative at USD/ZAR 18.50. Even a 0.01 micro-lot = $0.50/pip. Use the calculator above for live rates.
Position Sizing Example
Suppose you have a R50,000 account and risk 1% per trade (R500). You set a 20-pip stop loss on XAG/USD (silver can move 20 pips in minutes, so this is already aggressive).
At USD/ZAR 18.50, pip value per lot = R925. The formula:
Lots = Risk ÷ (Stop pips × Pip value in ZAR)
Lots = R500 ÷ (20 × R925) = R500 ÷ R18,500 ≈ 0.027 lots
Round down to 0.02 lots (2 micro-lots). Note: 0.02 lots of silver still moves R18.50 per pip. A sudden 50-pip spike (very common in silver) = R925 loss — nearly 2% of the account. Silver demands the most conservative sizing of any common instrument.
About XAG/USD — Key Drivers & Trading Hours
Silver is often described as "gold on steroids" — it follows gold's direction but with amplified moves. Silver has significant industrial demand (solar panels, electronics, EVs) on top of its safe-haven characteristics, making it sensitive to both risk appetite and manufacturing data. The gold/silver ratio (typically 70–90) is a key metric traders monitor to assess relative value.
The key drivers of XAG/USD are: US Dollar strength (inverse), gold price direction, industrial production data (ISM, PMI), solar and EV sector growth narratives, and mine supply from major producers (Mexico, Peru, China). Silver can move 3–5% in a single session on thin liquidity, especially during Asian hours.
Best trading hours in SAST: London–New York overlap 14:00–18:00 SAST, same as gold. Liquidity is thinner than gold throughout, so spreads are typically 2–5x wider. Avoid overnight positions unless you have wide stops — silver gaps are frequent and often exceed 30–50 pips.
Warning: At $50/pip per standard lot, even 0.01 lots = $0.50/pip. A 100-pip daily move (common for silver) on just 0.01 lots = $50 (R925). Never trade silver without a position-size calculator. This is the single instrument where over-sizing has blown the most retail accounts.
Pip values sourced from ECB reference data (Frankfurter API). All values are indicative and for educational purposes — not live trading quotes. See full pip value table →
