Lot Size

In practice

One standard lot of EUR/USD is €100,000, where each pip ≈ $10. A mini lot (0.10) is €10,000 at $1 per pip, and a micro lot (0.01) is €1,000 at $0.10 per pip. If your risk plan allows $20 on a trade with a 20-pip stop, a micro lot risks exactly that — $2 per pip × 10 pips would already breach it.

Why it matters for traders

Lot size is the dial you actually turn to match a trade to your risk. Get it wrong and even a perfect setup can damage the account, because the wrong lot turns a normal stop-out into a disproportionate loss. Calculate the lot from your account, risk percentage and stop distance — not from a guess typed into the order ticket.

Common pitfall

The mistake is typing a 'nice round' lot into the order ticket by feel — 0.10 because it looks reasonable — instead of calculating it. A 0.10 lot with a 50-pip stop risks five times more than the same lot with a 10-pip stop, because risk is lot × pip value × stop distance. Recalculate the lot every trade using a position-size calculator; eyeballing it is how accounts blow up on one ordinary-looking setup.

Lessons that use this term

• Lot sizes and position size

  Standard, mini and micro lots, pip value per lot, and how to pick a size your account can survive.

• Position sizing and the 1% rule

  Turning a percentage of your account into an exact lot size, every time.

Related terms