Trading currencies on the Forex market is done in batches that are called "lots. The amount of cash you keep in reserve plays a role in the lot size you can trade. Larger-sized lots produce profits at a faster rate than smaller lots; however, the losses can compound just as rapidly. When trading on the Forex market, some of the terms will sound strange until you get used to how the market operates. Currencies are traded in pairs and will be referred to in three-letter abbreviations. In forex case the GBP would be the "base" currency, and the USD would be the "counter" currency. The smallest movement in the value of the currency pair -- usually in the fourth decimal place -- is called a "pip. Currency pairs that do not involve the U. A standard forex is the largest lot forex which currencies can be traded. Purchasing a standard lot of a currency pair means that you are purchasingunits of the base currency. Trading companies vary in the amount you are required to keep in your account as a reserve. When you are trading currencies, you micro usually leveraging your account a significant amount. Forex market leverages range from 2 to 5 percent, compared to a 50 percent leverage in most stock market margin accounts. A mini lot trades 10, units of the base currency of each currency pair you purchase. When you are trading a currency pair that includes the U. A micro lot is the smallest lot size that is traded on the Forex market. Micro lot represents 1, units of the base currency. Lot you trade micro lots, the value of a pip in currency pairs that involve the U. Have you fantasized about lot by a wooded stream or lot a mountaintop? Can you simply not find the house you want By Barbara Gulin eHow Contributor. What Is a Pip in Forex Micro What Is a Pip Value? What is Forex Scalping? The Foreign Exchange Trading Process. How to Trade Currency Options. How to Trade The Forex. Free Printable Calendar And Weekly Inspirations for the Whole Year. About eHow Advertise Write For eHow Contact Us. Terms of Use Report Copyright Ad Choices en-US Privacy Policy Mobile Privacy. About eHow Advertise Contact Us Write For eHow Terms of Use Privacy Policy Report Copyright Ad Choices en-US How to by Topic Mobile Privacy.
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