Lot
A standardized trading unit. In forex, a standard lot is 100,000 units of the base currency.
A lot is a standard forex position size: 100,000 units for a standard lot, 10,000 for mini, 1,000 for micro. Every position-size calculation starts with the lot.
A lot is a standardized unit of measurement for a trading position. In forex, a standard lot equals 100,000 units of the base currency. Lots help standardize trading and calculate position sizes consistently. Lot size decides the dollar value of every pip and therefore the risk of the trade. On EUR/USD a standard lot is $10 per pip, a mini lot $1, a micro lot $0.10: position sizing starts by choosing the lot that keeps a losing trade inside your plan.
Types of Lot
Standard Lot
100,000 units - 1 pip ≈ $10
Mini Lot
10,000 units - 1 pip ≈ $1
Micro Lot
1,000 units - 1 pip ≈ $0.10
Nano Lot
100 units - 1 pip ≈ $0.01
Trading Tips
Start with micro lots when learning
Calculate lot size based on risk percentage
Different instruments may have different lot sizes
Related Terms
Sources
- InvestopediaLot sizes in forex
- BabyPipsPips and lots in the course
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