Gold (XAU/USD)

XAUUSD is a spot metal instrument in which gold is quoted against the US dollar. On this page, it is treated as a trading instrument: how the price is displayed, what a lot means, and how the result of a position is calculated. The page does not give a live gold price, and it does not predict where the price will go.

What XAUUSD means for a trader

The instrument is listed as Gold (XAU/USD) (XAUUSD). It is a metal, and it is quoted in USD. That means the price shown for the instrument is the price of gold expressed in US dollars.

This is different from the domestic gold rates that are usually discussed as the gold price in Pakistan. A local gold rate in Pakistan today, such as a 1 tola gold price in Pakistan or a 22 carat gold price in Pakistan, is a retail price in Pakistani rupees. XAUUSD is an international market quote in US dollars, so a trader looking at XAUUSD is not looking directly at the gold rate today Karachi markets display for jewellery or bullion.

Next steps from here: Position size · Gold (XAU/USD), then Value per pip · Gold (XAU/USD).

How the price is quoted

The price of XAUUSD is quoted with two decimal places. The minimum price step, or pip, is 0.01. A move from one quoted price to the next is therefore a move of one pip.

Because the quote has two decimal places, a trader should not confuse a small numerical change with a small result. The effect of a one-pip move depends on the position size, not only on how small the number looks.

What one lot contains

The contract size is 100 units of the base asset per lot. For this instrument, that corresponds to 100 troy ounces in a lot.

This matters because the quoted price refers to one unit of the base asset. A position of one lot is therefore much larger than a position that tracks only a single unit of the quoted price.

How the result of a trade is calculated

The result of a trade is calculated from the price movement measured in pips, multiplied by the value of one pip. For XAUUSD, the pip value is 0.01 × 100 in the quote currency, which is USD, per lot. The result is then converted into the account currency.

The calculation is not a promise of profit. It only shows how a given price movement translates into a money amount for a given position size. A trader can enter the position size and the price movement into the calculator on the site and see the result without doing the arithmetic by hand.

What can mislead a trader in XAUUSD

One common mistake is to treat XAUUSD as if it were the same as a domestic gold rate in Pakistan. A change in the international dollar price of gold does not move one-for-one with a 1 tola gold price in Pakistan, because the local price also depends on the USD to PKR exchange rate and on local market conditions.

Another risk is ignoring the contract size. Because one lot is 100 troy ounces, a price move that looks small in the quote can produce a large money result. The pip value already includes the contract size, so the result of a trade should be read from the calculator rather than estimated from the price change alone.

Questions from readers

Is XAUUSD the same as the gold rate in Pakistan today?

No. XAUUSD is gold quoted in US dollars on international markets. A gold rate in Pakistan today, including a 1 tola gold price in Pakistan or a 22 carat gold price in Pakistan, is a local price that also depends on the rupee and on local market conditions.

What is one pip in XAUUSD?

One pip is 0.01, and the price is quoted with two decimal places.

How much gold is in one lot of XAUUSD?

One lot is 100 units of the base asset, which is 100 troy ounces.

How is the result of an XAUUSD trade calculated?

The price movement in pips is multiplied by the pip value. The pip value is 0.01 × 100 in USD per lot, and the result is converted into the account currency.

Does the price of XAUUSD tell me the 1 tola gold price in Pakistan?

No. The XAUUSD quote is in US dollars and does not include the USD to PKR conversion or the local pricing used for a 1 tola gold price in Pakistan.