Nano lot
Family I · Instruments
Not to be confused with lot, lot size, standard lot.
Nano lot is a position-size unit used in foreign exchange and other leveraged markets, equal to 0.001 of a standard lot. In currency pairs it represents 100 units of the base currency, one tenth of a micro lot. The availability of nano lots varies by broker and jurisdiction, and some platforms do not offer them at all.[1]
Size in context
Lot sizes form a descending scale. A standard lot is 100,000 units of the base currency, a mini lot is 10,000, a micro lot is 1,000, and a nano lot is 100. Each step divides the previous size by ten, so a nano lot is one thousandth of a standard lot and one hundredth of a micro lot.
Because pip values scale with position size, a nano lot produces very small profit and loss amounts. That makes it useful for testing a strategy with real money while keeping risk per trade low, though the fixed costs of trading can be large relative to the position.
Worked example
A trader buys 1 nano lot of EUR/USD, equal to 100 euros, at 1.1000. The price rises to 1.1050, a gain of 50 pips. For a position of 100 units, each pip is worth 0.01 USD when the quote currency is USD, so the profit is 50 × 0.01 = 0.50 USD.
Availability and practical notes
Nano lots are not universally offered. Whether an account supports them depends on the broker, the platform and local regulation. Some brokers set a minimum trade size of 0.01 lots (a micro lot), which excludes nano lots entirely.
Spreads, commissions and swap charges are usually the same per lot regardless of size, so their proportional cost is highest on the smallest positions. A nano lot can therefore be inefficient for frequent trading even though the absolute risk is small.
Often confused with
- lot
- A lot is the generic term for any standardized contract size, whereas a nano lot is one specific size within that scale; the visible sign is that a lot can refer to 100,000 units or any other defined quantity, while a nano lot is always 100 units in forex.
- lot size
- Lot size is the general concept or setting that determines how many units a position controls, while a nano lot is a particular value of that setting; the visible sign is that lot size appears as a variable in position calculators, whereas nano lot is a fixed label.
- standard lot
- A standard lot is 100,000 units of the base currency, while a nano lot is 0.001 of that amount, or 100 units; the visible sign is the difference in unit count, with standard lot showing 100,000 and nano lot showing 100.
See also
References
- ↑ Contract specifications published by the broker or exchange for each instrument. Lot sizes, tick sizes and pip values are set per instrument and differ between venues; read the specification for the symbol you trade.