Micro Lot
Forex Basics
A micro lot is 1,000 units of the base currency — one-hundredth of a standard lot — with a pip value of about $0.10, popular with beginners managing small risk.
What is a micro lot?
A micro lot is a lot size of 1,000 units of the base currency — one-hundredth the size of a standard lot, and one-tenth the size of a mini lot. On most pairs quoted against the US dollar, a micro lot has a pip value of roughly $0.10 per pip.
Worked example
Suppose a trader opens 5 micro lots of USD/CAD (5,000 USD total). If the price moves 30 pips in their favor, the position gains roughly 30 × $0.10 × 5 = $15. Compare that to a single standard lot experiencing the same 30-pip move, which would gain roughly $300 — a stark illustration of how much smaller-scale micro lots make each individual trade, both in potential profit and potential loss.
Why traders use micro lots
Micro lots are especially popular with beginners and traders working with smaller accounts, because they allow real, live-market practice with meaningful risk management — a losing trade costs cents or a few dollars rather than tens or hundreds. They’re also useful for experienced traders fine-tuning a precise position size, for example combining several micro lots to hit an exact risk target that a mini or standard lot alone couldn’t match.
Why it matters to a trader
Because a small account can’t safely absorb the risk of standard or even mini lots without over-leveraging, micro lots let new traders keep their risk per trade proportional to a small account balance while still trading real money in live market conditions — a middle step between a demo account and full-size live trading.
Quick recap
- A micro lot equals 1,000 units of the base currency — one-hundredth of a standard lot.
- Its pip value is roughly $0.10 on most USD-quoted pairs.
- Micro lots are ideal for beginners and precise position sizing on smaller accounts.