A standard contract size: 100,000 units of the base currency in a standard lot.
Lot size is the fundamental unit of trade size in forex. A standard lot represents 100,000 units of the base currency: one standard lot of EUR/USD is a EUR 100,000 position. For most retail accounts, this is a very large commitment, so the market uses fractional lots - the mini lot (10,000 units, one-tenth of a standard) and the micro lot (1,000 units, one-hundredth of a standard). Some brokers also support nano lots of 100 units, useful for very small accounts.
Lot size directly determines pip value and therefore the cash risk per trade. On EUR/USD, a standard lot earns or loses USD 10 per pip; a mini lot earns or loses USD 1; a micro lot, USD 0.10. Knowing this relationship is the starting point for position sizing: a trader with a 20-pip stop risking USD 20 per trade needs a position of 0.1 standard lots (1 mini lot).
When reading broker specifications and comparing execution quality, spreads and commissions are always quoted on a per-standard-lot basis, so traders should be clear about whether a broker's advertised 0.1-pip spread or USD 7 round-turn commission applies to a 100,000-unit trade or something smaller. Retail accounts on platforms like MT4 and MT5 can open positions in increments as small as 0.01 lots (a micro lot), giving fine-grained control over risk.
Worked Example
You open a 0.1 lot (10,000-unit) EUR/USD position - one mini lot. Pip value = $1. You set a 20-pip stop-loss and a 40-pip take-profit. Maximum loss: 20 × $1 = $20. Target profit: 40 × $1 = $40. Risk/reward: 1:2. If the broker charges $7 commission per standard lot, your commission on 0.1 lots is $0.70 round-turn - a small fraction of the $20 risk.