What is a Lot in Forex: Explained in Simple Terms

If you want to make money in Forex, firstly you need to deal with the basics. How wonderful that we have prepared a whole post with useful information to make your life and work easier. Don't assume that information will solve everything. Practice will, of course, too. One of the key concepts in trading is the volume of a trade, which affects profits, losses and risks. In this article, we will tell what position sizes are and how to choose the right one for you. Ready to get started? Live and learn!

Lot — what’s that in general

In trading, this term means the amount of currency you buy or sell in a single trade. It sounds extremely simple, but there is no catch here, it's just the way it is. Let's do some math: if you open a position of 1 standard contract on the EUR/USD pair, it means you are buying or selling 100,000 euros.

Does that sound like a cosmic amount? Yeah, that's a lot. In fact, you don't have to hold that much money in your account. With leverage, brokers allow you to trade large volumes with much smaller amounts on your balance.

Imagine you have a game coin with a face value of 100,000 units. In game, you can change it into smaller coins. The same applies to trading volumes—they come in different sizes, meaning you can choose the one that best fits your strategy and risk tolerance. Yes, you always have a wide range of choices at your disposal and this is very supportive information meaning that all actions are subordinate to your will. If you understand that, nothing can go wrong. Let's move on, the further you go, the more exciting it gets.

Types of positions—what are the different sizes?

The size will determine how much risk-taking you can do. Not just that, of course. The outcome will depend on it too. That's how you learn control so you don't feel like you're without a steering wheel in the car.

There are 4 main types in Forex, and you should choose depending on your deposit and experience.

Standard Contract

100 000 currency units
1 pip = 10$
Suitable for pros with large deposits.

Mini Contract

10 000 units
1 pip = 1$
Excellent choice for those who have already mastered the base.

Micro Contract

1 000 units
1 point = 0.1$
Ideal for beginners to learn without high risk.

Nano Contract

100 units
1 point = 0.01$
The safest start if you want to practice without stress.

By the way! We'll tell you something you probably haven't guessed yet. Some brokers, like HFM и RoboForex, allow you to trade with super-small volumes, which is convenient for beginners. You can find them on our website in a specialized section. This is indeed quite a cool feature, you should try it! This would be good for your learning.

How to choose the right trade size?

We would say that's a very good question if you had asked. Our answer is already in place. It all depends on your deposit, trading style and risk. Take notes, because this information can become your new best tool. However, to make it better, you have to know how to use it.

What is your deposit?

- If you have $100 - it's better to start with nano- or micro-contracts.
- If you have $1 000 - you can try mini volume.
- If you have $10 000 or more, you can start at the standard level.

How much are you ready to lose?

There is a golden rule of trading: do not risk more than 1-2% of your deposit per trade.

Example:
If you have $1 000 in your account, your maximum risk per trade = $10-20.
If you set a stop loss of 20 pips, a micro-contract is perfect for you.

How to calculate a trade using a real example

The right thing to do is to take the real values for better assimilation. Let's say you have $500 in your account and you don't want to lose more than 2% per trade.

- 2% of $500 = $10 of risk.
- Your stop loss is 20 pips.
- If you take 1 micro-contract (0.01), you will lose $0.1$ if you move 1 pip.
- 20 pips × 0.1$ = 2$ loss (which is very small).

Conclusion: if you want the risk to be 10$, you can increase the volume to 0.05 (five micro-contracts). We hope this is crystal clear.

Where to look for additional info

If you want to go deeper into the topic, download PDF guides from brokers and traders. They usually have all the useful information you need, from choosing a trade size to complex strategies. The Globe Gain website also has categories of brokers where you can compare them and choose one to your liking. The TrustPilot review service is popular among traders - there you can find first-hand opinions on a particular trading service.

A helpful tool for traders is a price chart, which visually represents market trends and helps in making informed decisions.

Understanding market trends and economic indicators can give you a significant advantage in making successful trades.

Bottom line—what do you need to remember about?

• The volume of a trade affects risk and profit.
• There are 4 types of sizes: standard, mini, micro and nano.
• For beginners, it is better to start with micro or nano sizes to avoid draining your deposit.
• It is recommended to practice on a demo account before investing real money to gain confidence and refine your trading skills.
• Do not risk more than 1-2% of your deposit in one trade—this way you will protect your capital.
• A good trading strategy should include proper risk management, realistic goals, and continuous learning to improve your market skills.
• Managing your funds wisely is crucial in Forex trading, as it helps you sustain long-term profitability and mitigate potential losses.
• If you develop strong analytical skills and stay disciplined, you can earn consistent profits over time in Forex trading.
• Check brokers on Trustpilot, read the contract and study PDF guides before you start.
• Main tip: Forex is not a casino, only those who can do the math win here!

Conclusion

Here we have covered quite an important topic for today. A lot has been said about it, but we have tried to present only the most important. We hope you found it interesting and useful! So, you've learned how to find the right size for your needs, and you've learned that it's best not to be in a hurry. Start with micro and nano sizes to practice if you are a beginner. Only trust trust trusted sites with transparent terms and conditions. If you approach the business with intelligence and discipline, you can achieve stable results. Learn, try, and let your trades be profitable.