Story Points

Story points are the relative size or values of user stories and is one of the most popular unit of measure to estimate overall effort needed for an agile project. The story points are assigned to user stories on a relative scale. The scale used for relative sizing of the stories often follows the Fibonacci sequence (1, 2, 3, 5, 8, 13, 21). The team first decides on a baseline story with an estimate of 1 story point. Accordingly, they make a relative sizing for other stories considering the baseline story. For example, a user story with 5 points is five times larger than a story with 1 point.
Story point estimate include all the activities, efforts needed to complete the work.
Agile teams decide how many story points they can complete in an iteration.