Trading Academy
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Lot in Forex
What are Lots ?
Lots are used to represent the trade volume in units. One standard Lot in Forex is equal to 100,000 units of the base currency of the pair. So, for EUR/USD 1 lot is 100,000 euros, for USD/JPY 1 lot is 100,000 US Dollars. Thanks to FxPro, mini and micro-lots are also available to traders.
What are Lots ?
Lots are used to represent the trade volume in units. One standard Lot in Forex is equal to 100,000 units of the base currency of the pair. So, for EUR/USD 1 lot is 100,000 euros, for USD/JPY 1 lot is 100,000 US Dollars. Thanks to FxPro, mini and micro-lots are also available to traders.
Key Takeaways
✓ A lot is the number of units of a financial instrument that is traded on an exchange.
✓ Standard lot is the equivalent of 100,000 units of the base currency in a forex trade.
Standard Lot (1.0) = 100,000 of base currency
Mini Lot (0.1) = 10,000 of base currency
Micro Lot (0.01) = 1,000 of base currency
Understanding a Standard Lot
A standard lot represents 100,000 units of any currency, whereas a mini-lot represents 10,000 and a micro-lot represents 1,000 units of any currency. A one-pip movement for a standard lot corresponds with a $10 change.
For example, if you buy $100,000 against the Japanese yen at a rate of ¥110.00 and the exchange rate moves to ¥110.50, which is a 50 pip movement, you have made $500. Conversely, if the exchange rate falls 50 pips to ¥109.50 your net profit and loss are minus $500.
