Historically, currencies were traded in specific amounts called lots. The standard size for a lot is 100,000 units. There are also forex trading margin requirements for uncleared-lots of 10,000 and micro-lots of 1,000.
As we have already discussed in our previous article, currency movements are measured in pips and depending on our lot size a pip movement will have a different monetary value. So looking at an order window below we see that we have chosen to BUY a mini-lot of 10,000 units of the EURUSD. 10,000 worth of US Dollars at the exchange rate 1. So let’s say the exchange rate moves from 1. This is the equivalent of 100 pips.
We do not have to restrict ourselves to the historical specific amounts of standard, mini and micro. We can enter any amount we wish greater than 1,000 units. 1,000 units is the minimum position size we can open. So for example, we can sell 28,000 units of the GBPJPY currency pair at the rate of 156.