When you buy or sell currencies, you do not trade one single unit at a time. Forex trades are placed in standardized sizes called lots.
Lot size determines the notional value of your trade and how much money you gain or lose for each pip movement.
What is a lot?
A lot is a unit of measurement for the volume of currency you buy or sell in one trade.
When you place an order in MetaTrader 5 or cTrader, your position size is entered as volume. The volume controls the contract size and therefore your risk per pip.
Main forex lot sizes
| Lot type | Platform volume | Contract size | Approximate pip value on EUR/USD |
|---|---|---|---|
| Standard lot | 1.00 | 100,000 units | $10 per pip |
| Mini lot | 0.10 | 10,000 units | $1 per pip |
| Micro lot | 0.01 | 1,000 units | $0.10 per pip |
Pip values can vary by currency pair, account currency, and market price, but these examples are a useful guide for major USD-quoted pairs.
Standard lot
A standard lot represents 100,000 units of the base currency, which is the first currency listed in a pair.
If you open 1.00 lot on EUR/USD, you are controlling 100,000 euros. Each pip is worth roughly $10.
Mini lot
A mini lot is one tenth of a standard lot and represents 10,000 units of the base currency.
If you open 0.10 lot on EUR/USD, each pip is worth roughly $1.
Micro lot
A micro lot represents 1,000 units of the base currency.
If you open 0.01 lot on EUR/USD, each pip is worth roughly $0.10. This smaller size can help newer traders test live execution with lower exposure.
How leverage interacts with lot size
Leverage lets you open positions by putting down only a fraction of the full notional trade value as required margin.
For example, with 1:500 leverage, a $100,000 position may require about $200 of margin. The pip value does not become smaller just because the margin is smaller. This is why a highly leveraged position can still create large gains or losses.
How to choose a lot size
Before placing a trade, consider:
- Your account balance and equity
- The distance to your stop loss
- The pip value of the position
- The percentage of account equity you are willing to risk
- Whether other open positions already use margin
Both MetaTrader 5 and cTrader include a volume field in the order window where you can choose values such as 0.01, 0.10, or 1.00.