Minimum Lot Size

What Is a Lot Size?
In forex trading, a lot is in reference to the smallest available trade size you can place when trading on the market. The size of the lot has a direct impact on the risk you are taking. In which the lot size affects your account balance by how much the market moves. The smaller the lot, the less affect big market moves have on your account. So, for traders who are less experienced, a smaller lot size might be in their best interest due to less risk from smaller price movements.

Are you looking for online brokers with a minimum lot size of 0.01 lot or less? Follow the link and get the list of brokers with 0.01 lots or less.

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To get an idea of the effect of different lot sizes, see the example below:

Say you’re trading the Euro against the Dollar and you believe the Euro will rise and it does. Say the exchange rate rises by 100 pips and your lot size is 10,000 units ($10,000). With a lot size of $10,000, each pip is $1.00. If the exchange rate rises by 100 pips, that’s $100 in profit.
Respectively, if our lot size was $100,000 we would have made a profit of $1000 due to the pips being equal to $10 per pip.
Traders are blessed with the choice of choosing between three and sometimes four different lot sizes. Below we’ll go over what each one is called, their size, and their unique details.

Standard Lot Size
Standard lots are the biggest lots you can trade with and are most commonly used by experienced, high profile traders. Usually, you must have an account with at least $25,000 to trade standard lots. The lot is a 100k unit lot which means it is a $100,000 trade. On average, the pip size for these standard lots is $10 per pip, so you can easily get into the hundreds if not thousands in profits or losses when trading these lots.

Mini Lots
The next size down from a standard lot is a mini lot. These lots are significantly smaller than a standard lot at being only 1000 units of your accounts currency, (in the case of dollars it would be $1000). With these lots, the average pip amounts to 1$ per pip. A mini lot account might be a much better decision for a beginner trader since these accounts usually require at least $2000 deposits. However, although $1 pips might not seem like a lot, the markets can easily move by 100 pips in a day or even within hours. Depending on the trader, this still might be too much risk. For these types of traders, the next account is more suitable for them.

Micro Lots

For most brokers, micro lots are the smallest tradeable lots. These lots contain 1000 units, if your account is funded in dollars, $1000 dollars. Being significantly smaller than the other lot sizes, 1 pip amounts to only 10 cents, hence the name “micro”. Accounts utilizing micro lots are very good for beginner traders, so they don’t lose their shirt while trading.

Nano Lots
In some instances, there are brokers who offer nano lots. These are the smallest possible lot sizes of being only 100 units of currency, so $100. In these lots, 1 pip equals 1 cent. There are methods for profiting using nano lots, but are typically best used for beginners with a very low risk tolerance.