How to Calculate Lot Size in Forex and Gold (Position Size From Risk)
Quick answer: Lot size = money you are ready to lose ÷ (stop loss in pips × pip value per lot). With a 5,000 USD account, 1% risk (50 USD) and a 25 pip stop on EURUSD: 50 ÷ (25 × 10) = 0.20 lots.
Step by step
- Risk amount = account balance × risk %. Many traders use 0.5% to 2%.
- Stop loss distance: how far your stop is from entry, in pips (or in price for gold).
- Value per lot: about 10 USD per pip for one standard lot on pairs that end in USD (EURUSD, GBPUSD). Other pairs differ; use the pip value calculator.
- Lots = risk amount ÷ (stop distance × value per lot).
Ready table: EURUSD, 1% risk, 10 USD per pip
| Account | Risk (1%) | Stop 20 pips | Stop 30 pips | Stop 50 pips |
|---|---|---|---|---|
| 1,000 USD | 10 USD | 0.05 | 0.03 | 0.02 |
| 5,000 USD | 50 USD | 0.25 | 0.16 | 0.10 |
| 10,000 USD | 100 USD | 0.50 | 0.33 | 0.20 |
| 25,000 USD | 250 USD | 1.25 | 0.83 | 0.50 |
Lot sizes are rounded down to two decimals, so the real risk stays at or below 1%.
Gold (XAUUSD) example
At most brokers one gold lot is 100 ounces, so a 1 USD move in the price is 100 USD per lot. Account 10,000 USD, risk 1% = 100 USD, stop 5 USD away from entry: 100 ÷ (5 × 100) = 0.20 lots. Check your broker's contract size. The gold XAUUSD calculator works this out for you.
Common mistakes
- Choosing the lot first and the stop later. Decide the stop from the chart, then size the lot.
- Using the same lot size for every trade even when the stop distance changes.
- Forgetting that a pip on JPY pairs is 0.01, not 0.0001.
- Counting on leverage to limit risk. Leverage only changes the margin. See what leverage means.
Trading forex and gold carries a high risk of loss. This guide explains the math only and is not investment advice.
Open the lot size calculator →
Frequently asked questions
How do I calculate lot size in forex?
Lots = risk amount ÷ (stop loss in pips × pip value per lot). For 50 USD risk and a 25 pip stop at 10 USD per pip: 0.20 lots.
How much is one pip worth on 1 lot?
About 10 USD on pairs quoted in USD such as EURUSD. On other pairs it changes with the exchange rate.
How do I calculate lot size for gold?
One lot is usually 100 oz, so each 1 USD move is 100 USD per lot. Lots = risk ÷ (stop in USD × 100).
What lot size for a 1,000 USD account?
With 1% risk (10 USD) and a 20 pip stop on EURUSD: 10 ÷ (20 × 10) = 0.05 lots.
Is 1 lot too big for a small account?
Usually yes. On EURUSD 1 lot moves about 10 USD per pip, so a 50 pip loss would be 500 USD.
Official sources
This guide explains the general rules. It is not legal advice.