Every responsible trader knows their lot size limit so that they do not exceed the max lots or risk all of the available margin.
This is a simple step by step tutorial on how to calculate your max lot size.
What You’ll Need:
- Account Balance
- Risk % (how much of your account you’re willing to risk per trade)
- Stop Loss (in pips)
- Pip Value (depends on the currency pair and lot size)
Step-by-Step Guide
Step 1: Choose how much to risk per trade
- Standard is 1–2% of your account.
- Example: Account = $5,000, Risk = 2% → You’re risking $100 per trade.
Step 2: Determine your stop loss (in pips)
- Based on your strategy or technical analysis.
- Example: Stop loss = 50 pips
Step 3: Find the pip value per lot
For most USD-based pairs:
-
- 1 standard lot (100,000 units) = $10/pip
- 1 mini lot (10,000 units) = $1/pip
- 1 micro lot (1,000 units) = $0.10/pip
Step 4: Use the formula to calculate lot size
Example Calculation
- Account balance: $5,000
- Risk Amount: 2% → $100
- Stop loss: 50 pips
- Pip value per standard lot: $10
So you can trade 0.2 lots on this position safely.
We get it, some of us suck at math and this might not be easy for first timers. If you need help calculating your max lot size then don’t hesitate to reach out to us via the live-chat button and we’ll be happy to help!
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