lot size in forex trading
In Forex trading, a lot is a standard term for describing the size of the trade. It’s a standard unit just like buying 1 KG of vegetables, 1 pound of butter, etc. When trading, the size of your trade is always made up of lots. Therefore understanding the concept of a lot is extremely important. There are mainly three lot sizes that are micro, mini, and standard.
Understanding Lot Sizes
In Forex trading, a micro lot is a 1,000 unit trade, a mini lot is a 10,000 unit trade, and a standard lot is a 100,000 unit trade.
For example, If you choose to buy or sell a micro lot of EUR/USD, you will be trading 1000 Euros. If you choose to buy or sell 10,000 Euros you will be trading a mini lot. Likewise, if you buy or sell 100,000 Euros you will be trading a standard lot. You can trade any number of lots depending on your trading capital and the leverage.