A lot in forex is a fixed number of units of the base currency, the first currency in a pair. By convention, one standard lot is 100,000 units, a mini lot 10,000, a micro lot 1,000 and a nano lot 100, but each broker sets its own sizes. Your lot size decides what every pip is worth, so it decides your risk. This guide shows how to work out pip value in your own currency and size a trade from your stop-loss.
TL;DR: One standard lot is conventionally 100,000 units of the base currency, and 0.01 lot is 1,000 units. On EUR/USD, one standard lot moves USD 10 per pip. To size a trade, divide the money you will risk by the stop distance in pips times the pip value per lot, then round down. Leverage changes the margin you put up. It does not change your loss at the stop.
The worked examples below use European Central Bank reference rates for 10 November 2026. They are examples for learning, not the contract terms of any platform, Volity included. Check each instrument’s specification on your own platform before you trade.
A lot is a set number of units of the base currency
IG UK puts it plainly: “A lot in forex trading is a unit of measurement that standardises trade size.” (IG UK, read 10 November 2026). When you buy 1 lot of EUR/USD, you buy 100,000 euros and sell the matching amount of US dollars. The lot is a size, not a price. It says how many units you control, and the exchange rate then sets what those units are worth.
The 100,000 figure is a convention, and providers differ. Capital.com writes that “we don’t use designated lots” and lets positions be sized in steps of 100 units. Trade Nation notes that “not every broker offers nano lots”. CMC Markets says nano lots are “offered by select brokers”. So read the contract size on your own platform instead of assuming it.
The market behind these trades is huge. The BIS Triennial Survey initially put FX trading at $9.6 trillion per day in April 2025, up 28% from 2022 (BIS release, 30 September 2025). That is dealer turnover, and it says nothing about lot sizes.
Standard, mini, micro and nano lots compared
Each smaller lot is a tenth of the one above it. Lot sizes are written as decimals, so 0.25 lots means 25,000 units and 0.05 lots means 5,000 units.
| Lot type | Lot number | Units of base currency | Pip value on EUR/USD, USD account |
|---|---|---|---|
| Standard | 1.00 | 100,000 | USD 10 |
| Mini | 0.10 | 10,000 | USD 1 |
| Micro | 0.01 | 1,000 | USD 0.10 |
| Nano | 0.001 | 100 | USD 0.01 |
Trade Nation describes micro lots as “often the smallest tradable size offered by brokers”. In the UK, IG notes that spread bets are sized in value per point, so lots matter less there.
How lot size sets the value of a pip
A pip is the standard small price step of a pair: 0.0001 for most pairs and 0.01 for pairs quoted in Japanese yen. Our guide to what a pip is covers the detail. Pip value is the pip size times the units you hold, and it comes out in the quote currency, the second currency of the pair.
On EUR/USD that is 0.0001 × 100,000 = USD 10 per standard lot. If your account is in another currency, convert at the current rate. Here is the same lot in three account currencies, using ECB rates for 10 November 2026 (reference rate page, daily XML): EUR/USD 1.1214, EUR/GBP 0.83545 and EUR/JPY 177.38. From those, GBP/USD works out at 1.3423 and USD/JPY at 158.18.
- USD account, EUR/USD: USD 10 per pip per lot.
- GBP account, EUR/USD: 10 ÷ 1.3423 = GBP 7.45 per pip per lot.
- EUR account, EUR/USD: 10 ÷ 1.1214 = EUR 8.92 per pip per lot.
- USD account, USD/JPY: 0.01 × 100,000 = JPY 1,000, and 1,000 ÷ 158.18 = USD 6.32 per pip per lot.
Pip value scales with lot size, so 0.1 lot is worth a tenth of these figures. It also moves with the rate. If USD/JPY falls, each yen pip is worth more US dollars.
How to calculate lot size from your risk
Start from the money you are ready to lose, not from the lot size you would like to trade. The formula, which CMC Markets also prints, is: lots = risk amount ÷ (stop in pips × pip value per lot).
- Choose your risk per trade in your account currency. The examples use 1% of the balance, a common rule of thumb; set your own figure.
- Place the stop-loss where your trade idea is wrong, and count the distance in pips.
- Find the pip value of one standard lot in your account currency.
- Multiply the stop distance by that pip value. This is the loss per lot at the stop.
- Divide your risk by the loss per lot.
- Round down to the lot step your platform allows, then recheck the real risk.
Example A, USD account, EUR/USD. The balance is USD 10,000, so 1% is USD 100. The stop is 50 pips away. One lot loses 50 × USD 10 = USD 500 at the stop. Then 100 ÷ 500 = 0.2 lots, or 20,000 units.
Example B, GBP account, EUR/USD. The balance is GBP 5,000, so 1% is GBP 50. The stop is 40 pips away and one lot is worth GBP 7.45 per pip. One lot loses 40 × 7.45 = GBP 298 at the stop. Then 50 ÷ 298 = 0.168, which you round down to 0.16 lots. The real risk is 0.16 × 298 = GBP 47.68.
Example C, USD account, USD/JPY. The balance is USD 10,000 and the risk USD 100. The stop is 40 pips away and one lot is worth USD 6.32 per pip, so one lot loses USD 252.80 at the stop. Then 100 ÷ 252.80 = 0.396, rounded down to 0.39 lots. The real risk is 0.39 × 40 × JPY 1,000 = JPY 15,600, about USD 98.62 at 158.18.
Rounding down keeps you inside your plan. In Example B, 0.17 lots would risk GBP 50.66, more than the GBP 50 you set. A lot size calculator does the same sums, but knowing them lets you check its answer.
Lot size, margin and leverage
Margin is the deposit held while a position is open. Leverage is the ratio between the position’s full value, called notional value, and that deposit. So margin = notional ÷ leverage. At 1.1214, one lot of EUR/USD is EUR 100,000, or USD 112,140. A USD/JPY position is counted in US dollars already, so 0.39 lots is USD 39,000.
| Position (example) | Notional, USD | Margin at 1:30 | Margin at 1:100 | Margin at 1:500 |
|---|---|---|---|---|
| 1.00 lot EUR/USD | 112,140 | 3,738.00 | 1,121.40 | 224.28 |
| 0.2 lot EUR/USD (Example A) | 22,428 | 747.60 | 224.28 | 44.86 |
| 0.39 lot USD/JPY (Example C) | 39,000 | 1,300.00 | 390.00 | 78.00 |
| 0.01 lot EUR/USD | 1,121.40 | 37.38 | 11.21 | 2.24 |
Leverage changes the margin, not the pip value. Example A loses USD 100 at its stop whether it ties up USD 747.60 or USD 44.86. What higher leverage does change is how much of your balance stays free, and free balance makes it easy to open trades far larger than your risk plan allows.
Regulators cap leverage for retail clients in some regions. In March 2018, ESMA agreed limits from 30:1 to 2:1, with “30:1 for major currency pairs”, and later adopted final measures. The FCA made the same 30:1 to 2:1 range permanent for UK retail clients from 1 August 2019, in policy statement PS19/18. These are rules for retail clients in those places.
On Volity, forex, metals, index CFDs and commodities trade with leverage up to 1:500. Crypto CFDs go up to 1:50 and stock CFDs up to 1:20. Size from your risk first, and leverage only decides how much margin the trade needs.
Contract size differs by instrument and broker
A forex lot counts units of currency. Gold, indices and crypto have their own contract specifications, and each platform sets them. A forex lot table therefore cannot tell you what one lot of gold or of an index is worth per move. Read the contract size and the value per point in the instrument’s specification, then run the same formula with that value.
On Volity, gold, silver, US500, US100 and WTI are among a growing range of markets that trade 24/7 alongside crypto. Forex trades 24/5. Check each instrument’s specification before you size a trade in it.
Lot-size mistakes that change your real risk
- Using one lot size for every trade. A 0.2 lot with a 50-pip stop risks USD 100; with a 100-pip stop it risks USD 200.
- Forgetting the currency conversion. If you treat a USD/JPY pip as USD 10, Example C gives 0.25 lots instead of 0.39, and your risk is no longer what you planned.
- Rounding up. One step too many turned Example B’s GBP 50 plan into GBP 50.66.
- Sizing from free margin. At 1:500, one lot of EUR/USD needs USD 224.28 of margin, yet a 50-pip loss on it is USD 500, five times Example A’s planned risk.
- Leaving out the spread. You buy at the higher price and sell at the lower one, so the spread adds to the loss at your stop. Our guide on how to read a forex spread shows how to count it.
- Expecting a stop to fill exactly. In a fast market a stop can fill at a worse price. See market order vs limit order for how each order type fills.
On Volity, the Markets account is commission-free and spreads start from 0.6 pip. They are dynamic and tighter on Pro and VIP. The full cost schedule is on the Volity charges and fees page.
Practise lot sizing on a free demo
A demo lets you test the formula without money at stake. The free demo is available on every Volity account tier. Pick a pair, set a stop, work out the lots on paper, and place the trade at that size. Then compare the loss or gain at the stop with your sums. If they differ, look for a missed conversion or the spread. To plan a target, use the risk-reward calculator.
When your sizing matches on the demo, you can move to a live account. A Volity Markets account starts from $1, with funding from 10 EUR.
Before any live trade, you should be able to state three numbers: your risk in money, your stop in pips, and the pip value per lot in your account currency. If you have all three, the lot size follows.
Fact check: Exchange rates are ECB euro reference rates for 10 November 2026; pip, position and margin figures are our own arithmetic from them. Lot conventions from IG UK, CMC Markets, Capital.com and Trade Nation, read 10 and 11 November 2026. Retail leverage rules from ESMA (2018) and the FCA (2019). FX turnover from BIS Triennial Survey first results, 30 September 2025. Volity details from volity.io, checked 11 November 2026.
Frequently asked questions
What is a lot in forex?
A lot is a set number of units of the base currency that standardises trade size. One standard lot is conventionally 100,000 units, with mini, micro and nano lots at 10,000, 1,000 and 100. Brokers set their own sizes, so check the platform.
How much is 1 lot in forex?
One standard lot is 100,000 units of the base currency. On EUR/USD at 1.1214 (ECB, 10 November 2026), that is EUR 100,000, worth USD 112,140, and each pip moves it by USD 10.
What does 0.01 lot mean?
It is one micro lot, or 1,000 units of the base currency. On EUR/USD, 0.01 lot moves USD 0.10 per pip. Its notional value at 1.1214 is USD 1,121.40.
What lot size fits a USD 1,000 account?
Work it out from your risk. With a 50-pip stop on EUR/USD, 0.01 lot risks USD 5, which is 0.5% of USD 1,000, and 0.02 lot risks USD 10, or 1%. At 1:500 the margin on 0.01 lot is USD 2.24.
Does higher leverage change my pip value?
No. Pip value depends on the lot size, the pair and the exchange rate. Leverage only changes the margin. A 0.2-lot EUR/USD trade still loses USD 100 at a 50-pip stop at 1:30 or at 1:500.
Do all brokers use the same lot sizes?
No. The 100,000-unit standard lot is a convention. Capital.com says “we don’t use designated lots”, and Trade Nation and CMC Markets note that only some brokers offer nano lots. Always read the contract size on your platform.
