Been trading for a few months now and still get confused about lot sizes when placing orders.
Sometimes I see standard, mini, micro lots but honestly not sure which one I should be using for my account size.
Standard lot = 100,000 units of base currency. Mini lot = 10,000 units. Micro lot = 1,000 units.
Start with micro lots if you’re new. I jumped into mini lots way too early and lost half my account on one bad EUR/USD trade.
Never risk more than 2% per trade. Got $1,000? Stick with micro lots. $10,000 account? Mini lots work fine.
Most brokers do fractional lots now, so you don’t need exact multiples. Makes risk management way easier.
Some brokers offer nano lots too which are 100 units each. They’re even smaller than micro lots.
Micro lots until you stop blowing accounts.
Position sizing beats memorizing lot definitions every time. Start with your stop loss and work backwards. Want to risk $20 with a 50 pip stop? You need $0.40 per pip - that’s 4 micro lots. This simple math saves your account. New traders just pick random lot sizes, then watch their money disappear. Pick your risk amount first, let that tell you the lot size.
Pick your lot size based on risk tolerance, not account balance.
I figure out how much I want to risk per pip first, then choose whatever lot size gets me closest to that number.
Micro lots equal about $0.10 per pip on majors, mini lots are $1 per pip, and standard lots are $10 per pip.
This helps keep your risk consistent across all trades.