In forex trading terminology, when a trader says 0.1 lots, does this commonly mean minilots?
its Micro lots.
1 lot = standard lot = 100k
0.1 lot = mini lot = 10k
0.01 lot = micro lot = 1k
< 0.01 lot= units or penny lots = anything under 1k, USUALLY.
mini or micro??
Whoops ignore my comment Refer to
1 lot = standard lot = 100k
0.1 lot = mini lot = 10k
0.01 lot = micro lot = 1k
< 0.01 lot= units or penny lots = anything under 1k, USUALLY.
0.001 lots is what most people refer to as a ‘[I]nano lot[/I]’ (100 base currency units).
Only a few brokers offer position sizes below a micro lot though.
Anything below a nano lot becomes kinda hard to calculate, in regard of pip value.
To the best of my knowledge, the only broker offering position sizes below a nano lot is Oanda.
O.
Good morning.
Just to note to be careful here.
It’s sometimes broker and sometimes account type (standard account or mini account or micro account) dependant.
I assume we’re talking about MetaTrader here (again).
What I’m saying is that at ONE particular broker a ‘Volume’ (lot size) of 0.01 in MetaTrader MAY be the equivalent of 100 units of the base currency while at ANOTHER broker a ‘Volume’ of 0.01 in MetaTrader MAY be the equivalent of 1 000 units of the base currency (and so on and so forth).
The only way to be sure is to ask your broker and be specific e.g. ‘my account number is xxxx and if I buy or sell 0.01 lots of EUR/USD (for example) how many units of EUR/USD am I buying or selling’. Don’t even bother looking at or going by the ‘Contract Specifications’ in MetaTrader i.e. they’ll only confuse you more. What’s more: SAVE the record of your ‘Live Chat’ or any other communications with your the broker’s Customer Support (at SOME brokers even Customer Support don’t know what they’re talking about and YOU end up ‘carrying the can’)!!!
Also: be extremely careful with Gold and Silver ‘Volume’ (lot size) in MetaTrader. At some brokers you’ll be buying or selling 1 troy ounce of Gold or 1 troy ounce of Silver using a ‘Volume’ (lot size) of 0.01 in MetaTrader whereas at other brokers a ‘Volume’ (lot size) of 0.01 in MetaTrader of Gold and Silver may be many more troy ounces.
The above is important because (obviously) it will affect you $ value per pip movement and therefore your risk calculations.
STRICTLY speaking the figures and descriptions that you’ve already been given above by others are the ‘generally accepted descriptions’ of the different lot sizes e.g. a standard lot of EUR/USD is 100 000 units of the base currency (which should equate to $10 per pip movement) and so on and so forth. But as I said: in a many cases it’s broker and account type dependant so don’t just assume that a ‘Volume’ (lot size) of 1.0 (for example) in MetaTrader is a standard lot of 100 000 units of (EUR/USD for example) is all I’m saying. There’s nothing quite like the ‘reality check’ when you THOUGHT you were risking 2% of your account while in fact you were unknowingly risking 20% of your account on a single trade!!! And calling the broker and saying ‘but I did not understand’??? Well: that’s only going to help you on your NEXT trade and that of course assumes you’ve not ‘wiped out’ by then because of incorrect position sizing on your FIRST trade!!! LOL!!!
As with EVERYTHING SINGLE LITTLE THING in this business: KNOW BEFOREHAND what you’re doing. That’s what these forums are for i.e. when in doubt: ASK. And if you don’t understand the answer given: ASK AGAIN until you DO understand. Otherwise you could be in for some very uncomfortable and unpleasant ‘shocks to the system’ which INEVITABLY WILL cost YOU money!!!
Also: there are no such things as stupid questions (although sometimes I DO wonder about that). What’s more: if in doubt ask your broker. Remember: YOU ARE THE CLIENT (CUSTOMER)!!! Without YOU: the broker wouldn’t be in business!!!
Regards,
Dale.
It is confusing, i´d rather talk about units, for example 0.01 mini lots is in fact a 100USD unit, 0.1 1000 USD and 1 mini lot 10 000 USD unit. For Standards, 0.01 lots are 1000 USD Units.
For some ECN brokers, like Dukascopy, they use units of millions, so one 0.001 lot is 1000 USD unit.
Regards.
It is confusing, i´d rather talk about units, for example 0.01 mini lots is in fact a 100USD unit, 0.1 1000 USD and 1 mini lot 10 000 USD unit. For Standards, 0.01 lots are 1000 USD Units.
For some ECN brokers, like Dukascopy, they use units of millions, so one 0.001 lot is 1000 USD unit.
Regards.
It is confusing but need not be. The point I’m trying to make is to not just ASSUME that at any particular MetaTrader broker a ‘Volume’ (lots size) of 1.00 is one standard lot of 100 000 units. It is not ‘standard across the board’ is the point I was trying to make. With other trading platforms it’s usually different i.e. the trading platform actually shows you how many units you’re buying or selling when placing the order e.g. 100, 1 000, 10 000, 100 000, and so on and so forth. But as noted: this is not a ‘standard’ with MetaTrader ‘Volume’ (lot) sizing and depends on the broker and the account type. It’s important to find out WHAT you’re trading. I know someone who ‘assumed’ that 1 MetaTrader ‘Volume’ (lot) of Gold was 1 troy ounce and 1 MetaTrader ‘Volume’ (lot) of Silver was also 1 troy once. Turns out: 1 ‘Volume’ (lot) of Silver was 500 troy ounces (all at the same broker). The end result??? A total wipe-out of an (admittedly small) account within a few cents movement in the price of the Silver.
There’s no question, for example, that 100 000 units is a standard lot. But it can be dependant on how the trading platform is designed and / or set up.
But hey: if a trader just wants to go ahead and make assumptions without doing their due diligence then all the better for the broker. Simple.
Regards,
Dale.