What is a Lot in Forex Trading?
Lot
Forex Trading Glossary
Quick Answer: A lot is a standardized unit of trade size. A standard lot is 100,000 units of base currency, mini lot is 10,000, and micro lot is 1,000.
What is a Forex Lot?
A lot represents a standardized trading size. In spot forex the common lot sizes are standard (100,000 units), mini (10,000 units), micro (1,000 units), and nano (100 units).
Why Lot Size Matters
- Pip value: Determines how much each pip movement is worth.
- Margin requirement: Larger lots require more margin to open.
- Risk control: Lot size is the foundation of position sizing.
- Broker minimums: Some brokers limit the smallest allowed lot size.
Related Terms
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