In this article you will find what is a good lot size for some popular Forex account amounts.
You will find what is the suggested position size for accounts of:
- 10$
- 50$
- 100$
- 200$
- 500$
- 1000$
- 10000$
What Is The Position Size
The position size, or also “Lot Size”, is the size of the trade you are planning to enter.
We cover the Position Size topic in more details in this article if you want to find out more.
In Short, when trading CFDs (Forex usually), your lot size is not a currency amount but rather in units, or fractions of units.
Position Size is a key component of trading risk management and it is important to understand it.
The calculation and formula of Position Size (or Lot Size if you prefer) are covered in the Position Size article.
The calculation is not hard but it requires a few elements, which are:
- Risk
- Stop Loss
- Asset or Currency you are trading
Position Size Calculator For MT4 and MT5
Considering trading already involves many tasks and actions, it is useful to have tools that help with information and charts.
Position Size Calculator is a FREE indicator for the Metatrader MT4 and MT5 platforms that automatically calculates the recommended lot size given a risk.
Instead of having to calculate all of the elements and then process the formula the Lot Size Calculator automatically shows it on chart.
You can download the following indicators from the respective pages in the links below:
This is a quick preview of what the Lot Size Calculator does.
The Lot Size Calculator indicator works with all of the following instruments:
- Forex Pairs
- Indices
- Crypto
- Commodities
- Anything quoted by the broker
Popular Lot Size For Popular Account Amounts
It is very common to start trading with small accounts to then grow into bigger amounts.
Usually people start with accounts that can span from 50-100$ up to several thousands or even hundred of 1000s of $.
Regardless of the account amount it is always important to adopt good Risk Management or you may have unpleasant surprises in the trading journey.
Hearing about “Accounts Blown” is unfortunately very common and is usually the result of poor risk management.
In the coming paragraphs you will find some of the recommended lot size for popular trading amounts but we need to first set a common background.
Risk Management To Calculate Recommended Lot Size
The recommended Lot Sizes you are going to see are all being calculated using the Position Size Calculator for MT4 and MT5 indicators.
The generic Risk Management rule used to calculate the risk amount is the 1% of the Account Balance.
We will use the EURUSD, which is the most popular pair traded.
We will use two different stop losses to show you two different lot sizes.
The stop loss normally depends on the time horizon of the trade, short time trades normally have smaller stop loss than a long term trade.
You will see the Lot Size calculation based on a stop loss of 10 pips (100 points) and 200 pips (2000 points)
100 Points can be acceptable for some scalping but you also need to be careful with volatility and spread.
2000 Points is more for swing trading and trades that will be open for several days.
Lot Size For A 10$ Account
If you are starting with a 10$ account unfortunately I don’t have good news for you.
Using a 1% risk rule per trade it means you would be risking 10 cents per trade.
With a Stop Loss of either 100 or 2000 points, even the smallest position size would have a risk above 10 cents.
There is no good lot size for a forex account of 10$ or less.
Lot Size For A 20$ Account
The situation is the same for a 20$ Forex Account.
Even with a 1% the risk would be 20 cents and the minimum lot size of 0.01 lots and a stop loss of 100 points would mean a risk of 1$, which is above the appetite.
In short, there is no good lot size for a 20$ Forex Account.
Lot Size For A 50$ Account
Still the same with a 50$ Forex Account.
A 1% the risk would be 50 cents and the minimum lot size of 0.01 lots and a stop loss of 100 points would mean a risk of 1$, which is above the max risk allowed.
In short, there is no good lot size for a 50$ Forex Account.
Lot Size For A 100$ Account
With a 100$ account you may be able to start trading to some extent.
With a 1% risk the risk would be 1$ which would be the bare minimum to match the max loss of a trade with lot size of 0.01 lots and a stop loss of 100 points.
The good lot size to get started with a 100$ Forex account would be 0.01 lots.
This is assuming some scalping trades with very tight stop loss.
Day trading and swing trading with wider stop losses would be too risky.
Lot Size For A 500$ Account
A 500$ account may be a better starting account.
With a 1% risk the risk would be 5$ per trade which would be above the loss for a trade with lot size of 0.01 lots and a stop loss of 100 points.
The good lot size to get started with a 500$ Forex account would be 0.05 lots.
This is assuming some scalping trades with very tight stop loss.
Again, this account size would not be suitable for trades with a wider stop loss.
Lot Size For A 1000$ Account
1000$ is a very common amount to start trading.
It is an amount most people would be comfortable trading with and getting started in the trading journey.
A 1000$ account with a 1% risk per trade means a risk per trade of 10$.
Using a 100 points stop loss a good lot size for a 1000$ account could be 0.10 lots.
This account size however would not be suitable for trades with a stop loss above 1000 points.
Lot Size For A 10000$ Account
10000$ is a comfortable Forex account amount to trade.
It is an amount many people would be comfortable trading with.
A 10000$ account with a 1% risk per trade means a risk per trade of 100$.
Using a 100 points stop loss a good lot size for a 10000$ account could be 1.00 lots.
This account size also allows larger stop losses, with a 2000 points stop loss a good lot size for a 10000$ Forex account would be 0.05 lots.
Account Size Consideration Considering Lot Size And Risk
Now you have an idea of some of the popular lot sizes connected to popular risk amounts.
Considering what you saw you can understand that micro accounts under 100$ are probably not suitable to any type of trading.
And here I must mention that this is not in any way financial, investment or trading advise.
Based on experience and popular knowledge, the minimum amount to start exploring trading seems to be above 500$.
A 500$ account would allow you to start learning and experimenting trading while still limiting the risk exposute.
If you don’t have 500$ perhaps it is the case of save up some money to build a starting account.
One of the benefits of using Metatrader as a platform, and its brokers, is that you can always start with a demo account and fake money.
Demo accounts are the perfect tools to start and learn, and they are free!
Position Size Calculator Download
One last reminder that finding the Position Size, or Lot Size, it’s really easy with the right tool.
The Position Size Calculator indicators are available for Free Download, links below.
You can download the following indicators from the respective pages in the links below:
Summary
In this article you learn about the Position Size and the Calculator that is available for download.
You also saw what is a good lot size for Forex accounts of different amounts.
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