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What is a lot in the stock market?

Updated: 8/20/2019
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11y ago

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In the simplest sense the smallest number of units, that can be purchased either by contract size, or based upon commissions and fees.

To clarify, the least number of shares that you can buy is obviously 1, however commissions will be charged by the "lot." So if a BD charges $20 per lot of 100 shares, the "lot" is 100 shares.

You can still purchase less, yet you woill be charged the full $20 commission and fees. This is known as an "Odd Lot."

"Lot" is more commonly used in futures, options or other investment vehicles that package a "unit." For example, in Crude Oil the contract size is 1,000 barrels per contract. You do not have the opportunity to buy in other increments. The lot size is 1,000 barrels.

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