Market Structure
Mini Lot
A position of 10,000 units of the base currency, one tenth of a standard lot.
What Mini Lot means
A mini lot is 10,000 units of the base currency, entered as 0.10 on most platforms. It was introduced to let smaller accounts trade with realistic stop distances without taking outsized risk. On pairs quoted in US dollars a mini lot gives a pip value of one US dollar, so a 50 pip stop risks 50 dollars, which is a sensible unit for accounts in the low thousands.
Mini lots also make incremental position management practical. A trader can scale into a position in tenths, or close part of a winner while leaving the remainder to run, which is difficult when a standard lot is the minimum increment. The caveat is cost proportionality: fixed elements such as a minimum commission per ticket or a wide fixed spread weigh more heavily on smaller sizes, so frequent trading in mini lots can be relatively expensive.
Worked example
One mini lot of GBP/USD at 1.2700 is 10,000 pounds, about 12,700 US dollars of notional, and each pip is worth one US dollar.
Related terms
- LotThe standard unit of trade size in forex, measured in units of the base currency.
- Standard LotA position of 100,000 units of the base currency, the benchmark trade size in forex.
- Micro LotA position of 1,000 units of the base currency, one hundredth of a standard lot.
- Position SizingThe process of choosing how many lots to trade so that a losing trade costs a predetermined amount of capital.
- CommissionAn explicit per-trade or per-lot fee charged by the broker in addition to, or instead of, a marked-up spread.
Frequently asked questions
What does Mini Lot mean in forex trading?
A position of 10,000 units of the base currency, one tenth of a standard lot.
How does Mini Lot work in practice?
Mini lots also make incremental position management practical. A trader can scale into a position in tenths, or close part of a winner while leaving the remainder to run, which is difficult when a standard lot is the minimum increment. The caveat is cost proportionality: fixed elements such as a minimum commission per ticket or a wide fixed spread weigh more heavily on smaller sizes, so frequent trading in mini lots can be relatively expensive.
What is an example of Mini Lot?
One mini lot of GBP/USD at 1.2700 is 10,000 pounds, about 12,700 US dollars of notional, and each pip is worth one US dollar.
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