Tick value

The money equivalent of the smallest price step. It follows directly from two properties of the instrument: the tick size, which is how far one step is, and the contract size, which is how much of the underlying one contract covers. The two multiplied together give what a single step is worth on one contract, expressed in the currency the instrument is quoted in.

It is the bridge between a chart and an account. A movement read on a chart is a distance in price; a movement felt on an account is an amount of money; tick value converts one into the other, and position size scales the conversion. Where the instrument is quoted in a currency other than the one the account is denominated in, a second conversion follows at the prevailing exchange rate, which means the amount reaching the account moves a little even when the tick value in the quote currency does not.

The trip is assuming it is fixed. It is fixed for instruments quoted in the account's own currency, and it drifts for everything else, because the conversion rate drifts. For a currency pair the calculation also runs the other way round for one class of pairs, those in which the account currency is the base rather than the counter, and there the amount per step depends on the pair's own rate and changes as the rate does. Two positions of identical stated volume in two instruments are rarely the same exposure, and comparing them by volume rather than by value per step is the most common sizing error there is.