LOT TYPES Commander in Pips: Excellent! And what does “Lot size” mean? What kinds of Lot types are you familiar with? Pipruit: Lot size shows how much Base currency will be traded in terms of units. First, we should look at the base currency of any pair; let’s suppose that this is EUR/USD. Then we should take a look at Lot size. If Lot, for example, equals 100 000, then it means that we will trade 100 000 EUR for USD whatever amount of USD needed will be. Commander in Pips: And what amount of USD will that be? Pipruit: This, in turn, depends on the exchange rate. Say, EUR/USD=1.32 shows, how many units of Quote currency I will have to pay or get for one unit of base currency, depending on direction of trade. In this case for each EUR I will pay or get 1.32 USD. Returning to our associating of Base currency with Item and Quote currency with money – how much should I pay in USD for every 1 EUR I buy, or how much I will get in USD for every 1 EUR that I sell. Commander in Pips: That’s right – the rate shows the price of Base currency in terms of Quote currency. So, what types of lots are commonly used on the forex market? Pipruit: Ok – 1. Standard lot = 100 000 units of Base currency; 2. Mini Lot = 0.1 of Standard Lot = 10 000 units of Base currency; 3. Micro Lot = 0.01 of Standard Lot = 1000 units of Base currency; 4. Other lower Lots, sometimes it calls as “Nano Lots” = 0.001 of Standard lot = 100 units of base currency; 5. Free lot size – some brokers allow to choose any lot size by the client at wish. Commander in Pips: Good, I see you’ve done well, with this material.