This can be replicated all the way down to the nano-lot.
To make it easier to understand, because it can be complex, let’s do it again but for a different pair.
This time USD/JPY.
The USD/JPY pip value is 0.01 – this is where we look to see how many pips the currency pair has moved.
So, let’s input the formula below:
(value of pip = 2 places behind decimal place/121.90) * 1 lot (100,000 units)
(0.01*121.90) * 100,000 = $8.20 per pip.
Does this make sense now?
How much is 0.01 lot in forex
0.0 1 is a micro lot in forex which is 1,000 units of currency.
The value of the pip for a micro-lot is roughly $0.10 based on the EUR/USD.
This is usually the value most beginner traders start with. It is enough for you to risk some capital, but not enough for you to panic when the market goes against you.
In fact, we recommend that traders move on to this trading size and away from a demo account as soon as they are comfortable.
How much is 0.1 lot in forex
0.1 is a mini lot in forex which is 10,000 units of currency.
The value of the pip for a mini lot is roughly $1based on the EUR/USD.
Traders that use mini lots are now more adapted to the markets and are looking to grow their capital further by taking on more risk. The “training wheels” of the micro lot have been taken off.
How much is 1 lot in forex
1 lot in forex is 100,000 units of currency.
The value of the pip for 1 lot is roughly $10 based on the EUR/USD.
Traders who trade in lot sizes are usually experienced and comfortable with the risk associated with it. Although, it’s still not a significant amount – in a place where the markets can be unpredictable – it’s still seen as the standard trading size across the world.
What is 5 lots in forex
5 lots in forex is 500,000 units of currency.
The value of the pip for 1 lot is roughly $50 based on the EUR/USD.
Now if you are trading 5 lots in forex, then you certainly have a decent trading account size to take on larger risks and larger rewards.
How much is 10 lots in forex
10 lots in forex is 1,000,000 units of currency.
The value of the pip for 1 lot is roughly $100 based on the EUR/USD.
Wrapping it up
Hopefully, you’ve come to the end with the understanding of what is lots size in forex trading.
Now you’ve read through the basics of what is lots size in forex and how to calculate them, you can eliminate the simple, yet costly mistakes eager traders do and finally focus on collecting them pips!
The beauty of modern-day trading platforms is that they remember your preferences when it comes to trading, so if you want to trade 0.5 lots then you can allow the system to remember your choice – this speed up trading whilst eliminating careless mistakes.
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