Standard, Mini, Micro: Where Lot Sizes Come From

[Shadow Trader]

A standard lot in spot forex is conventionally 100,000 units of the base currency. This figure is rooted in interbank practice, where dealing sizes were large round amounts. Retail platforms later divided that unit into smaller pieces so that traders with modest accounts could participate.

The common labels are a mini lot of 10,000 units, a micro lot of 1,000 units and, at some brokers, a nano lot of 100 units. These names are conventions rather than regulated terms, and they are not identical everywhere. Some platforms express size directly in units, and others use decimals such as 0.01 lots to represent a micro position.

Contract specifications also differ across instruments. A lot of a currency pair is not the same notional amount as a lot of gold, an index or a cryptocurrency contract offered as a derivative, even when the platform uses the same word.

For scalpers, the point is that position size, pip value and margin all stem from the contract specification, not from the label alone. Pip value on a standard lot of a dollar-quoted pair is a round number in dollars, but it changes for other quote currencies. Reading the specification sheet of each instrument before trading it is a simple habit that prevents miscalculated exposure.