{"term":{"slug":"lot-size","term":"Lot Size","definition":"The standardized quantity of a financial instrument in a single trade. In forex, 1 standard lot = 100,000 units of the base currency. In futures, lot size varies by contract (1 ES = $50/point, 1 NQ = $20/point).","extendedExplanation":"Lot size directly determines your dollar-per-pip or dollar-per-tick exposure. In forex, there are three standard sizes: standard lot (100,000 units, ~$10/pip for USD pairs), mini lot (10,000 units, ~$1/pip), and micro lot (1,000 units, ~$0.10/pip).\n\nFor prop firm traders, lot size selection must be calibrated to your drawdown limits. Trading too large relative to your account means a small adverse move can breach daily loss limits. Trading too small means hitting profit targets takes much longer.\n\nThe general recommendation for prop firm trading is to start with smaller lot sizes during evaluation and only increase once you have built a profit cushion. Many successful prop firm traders use 0.5-1% risk per trade, which translates to specific lot sizes based on stop-loss distance.","exampleWithNumbers":"FTMO $100K, trading EUR/USD with 30-pip stop-loss, risking 1% ($1,000). Pip value for 1 standard lot = $10. Lots = $1,000 / (30 pips * $10) = 3.33 lots. Round down to 3 lots. Actual risk: 3 * 30 * $10 = $900. If EUR/USD moves 50 pips in your favor: profit = 3 * 50 * $10 = $1,500. Daily loss limit allows 5.5 full losses at this size.","category":"risk","relatedTerms":["pip-value","position-sizing","leverage","risk-per-trade","max-contracts"]},"_links":{"self":"https://runvigil.app/api/glossary/lot-size","page":"https://runvigil.app/learn/lot-size","allTerms":"https://runvigil.app/api/glossary","learn":"https://runvigil.app/learn"}}