trading career as well as a helpful analogy borrowed from one of the most respected books in the trading business. A lot references the smallest available trade size that you can place when trading the. So with a lot size 10,000, each pip movement.00 profit or loss to us (10,000*.0001.00). For the most part, however, an overnight premium will be a charge on our account and again this relates to the size of our position. Besides, if you bought a new expert advisor or are trying a new trading strategy, I recommend you to use nano lot for first few weeks so that you wont suffer big losses. Would you like to add your own comment or ask another question?
Lot size directly impacts how much a market move affects your accounts so that 100 pip move on a small trade will not be felt nearly as much as the same hundred pip move on a very large trade size. So for example, if we were buying the AUD/CHF we would earn a positive overnight sum as we would earn interest on the Australian Dollars we bought as the Australian interest rate is higher than the Swiss how much can i earn from forex trading interest rate (in fact the Swiss interest rate. If we were using a US Dollar platform that 5 is automatically converted to dollars by our broker at the current exchange rate for the EUR/USD. The smallest price change/move). Because trading in Forex is as much about losing money as about making money. Ill try to explain all to you as much as I can. Mini Lot If you are new in forex trading, I strongly recommend you to use mini, micro or nano lots to avoid big losses. So lets say the exchange rate moves from.35917.36917 the exchange rate rose. Those numbers are the industry standards but may change among brokers. Trading Forex is known as one of the riskiest capital investments.
For this purpose various risk management and money management strategies are created. Using, micro, lots, micro lots are the smallest tradable lot available to most brokers.