%22Lot size%22 confuses more new gold traders than any other topic %97 and getting it wrong is the most expensive mistake in trading. This guide explains it in plain English%2C with the exact numbers for XAUUSD.%0A%0A%23%23 What a lot actually means%0A%0AA lot is simply the size of your trade. For gold%3A%0A%0A- %2A%2A1.00 standard lot%2A%2A %3D 100 ounces of gold%0A- %2A%2A0.10 mini lot%2A%2A %3D 10 ounces%0A- %2A%2A0.01 micro lot%2A%2A %3D 1 ounce%0A%0A%23%23 What each lot size is worth per pip%0A%0AFor XAUUSD%2C a %22pip%22 is a 0.10 move in price %28so a %241.00 move in gold %3D 10 pips%29%3A%0A%0A- %2A%2A1.00 lot%2A%2A %3F about %2410 per pip%0A- %2A%2A0.10 lot%2A%2A %3F about %241 per pip%0A- %2A%2A0.01 lot%2A%2A %3F about %240.10 per pip%0A%0ASo if you are trading 0.10 lots and gold moves 200 pips in your favour%2C that is roughly %24200.%0A%0A%23%23 Why this is the number that matters most%0A%0AImagine two traders with %241%2C000 accounts. Both take the same trade with a 200-pip stop-loss.%0A%0A- Trader A uses %2A%2A1.00 lot%2A%2A. If stopped out%3A about %242%2C000 lost %97 the account is gone twice over.%0A- Trader B uses %2A%2A0.02 lots%2A%2A. If stopped out%3A about %2440 lost %97 4%25 of the account%2C survivable.%0A%0ASame analysis. Same signal. Completely different outcome. The difference was not skill%3B it was position sizing.%0A%0A%23%23 The simple formula%0A%0A%2A%2ALot size %3D %28Account %D7 Risk %25%29 %F7 %28Stop-loss in pips %D7 pip value per lot%29%2A%2A%0A%0AExample%3A %241%2C000 account%2C risking 2%25 %28%2420%29%2C with a 200-pip stop%3A%0A%0A%2420 %F7 %28200 %D7 %2410%29 %3D %2A%2A0.01 lots%2A%2A%0A%0AIf arithmetic under pressure is not your idea of fun%2C use our free [position size calculator]%28%2Ftools%2Fposition-size-calculator%29 %97 enter your account%2C risk percentage and stop distance%2C and it gives you the exact lot size.%0A%0A%23%23 Rules worth keeping%0A%0A1. %2A%2ANever choose a lot size by feel.%2A%2A Calculate it from your stop-loss every time.%0A2. %2A%2ASmall accounts need micro lots.%2A%2A Under %241%2C000%2C you should mostly be trading 0.01-0.02 on gold.%0A3. %2A%2ABigger stop %3D smaller lot.%2A%2A A wider stop is not more risk if you shrink the size to match.%0A4. %2A%2AGold is not EURUSD.%2A%2A It moves far more per day%2C so the same lot size carries much bigger swings.%0A%0AGet this one thing right and you will outlast most beginners %97 regardless of whose signals you follow.