Do you trade the proper lot size?


Confirmed PaxForex Representative
Apr 22, 2013
From what I have heard and by speaking to new traders I have found yet another common mistake: most trade the wrong lot size for their account balance. They trade lost sizes which are too high guided by the potential to earn more money. This does not only cause their risk management to become corrupt, but also forces tight stop loss levels which often leads to traders being stopped out and face unnecessary losses.

Ask yourself if you trade the proper lot size and take a second look at the volume you trade in relation to your total account balance. Look through your past trades and see if a smaller lot size and bigger stop loss would have caused you to actually earn on the trade. While there is no right or wrong approach to how many lots you should trade, here is an example which you may use as a guideline:

If you have $1,000 in a mini-account where 1.0 lot equals 10,000 currency units you should not trade more than 0.10 lots per position (again, it depends on your trading strategy and personal preference, but maybe this will allow you to better evaluate your own approach).


Confirmed HotForex Representative
Oct 24, 2013
Indeed, your observation come in especially with callow unfledged traders who don't realize the importance of trading conditions they have. Sormetimes it is credited to broker, who has such conditions as default. So it is essential to know what you need and what your broker offers..