How to size a forex trade in rand

The form will offer you a lot. That is the firm’s number. Yours is the rand you can lose without it touching rent, and it has to be chosen before the lot, not after a bad afternoon.

Sample card starting from a R50 loss, showing an 80-pip stop at 0.01 lot against a 0.10 lot spread of about R51. — A drawn budget, not a size we are telling you to trade.

Start from the rand, not the dropdown

Write down one figure: the loss that ends the idea. Call it R50 for the arithmetic, because R50 is easy to check and small enough that nobody should be proud of it. If R50 is already money you need, the right size is no trade. A smaller deposit does not fix that. The deposit is what you sent. The loss is what the pair can do to it.

The spread spends the budget first

On the sample USD/ZAR ticket the buy is 18.2461 and the sell is 18.2410. That gap is 51 pips. The cost guide turns a pip into rand when the account is in rand: about R0.10 at 0.01 lot, about R1 at 0.10 lot, about R10 at 1.00 lot. The same 51 pips are therefore a very different bill.

Size	Rand per pip	51-pip spread	80-pip stop
0.01 lot	R0.10	about R5.10	R8
0.10 lot	R1	about R51	R80
1.00 lot	R10	about R510	R800

The stop column is the further loss if the price then travels 80 pips against you and the stop is honoured. It does not include the spread, and a stop is not always honoured at the line. Read it as a floor on the imagination, not as a contract.

A worked R50

At 0.10 lot the spread alone is about R51. A budget of R50 is gone before you have a view. At 0.01 lot the same spread is about R5.10, and an 80-pip stop is R8. Together that is about R13 of the R50, which leaves a little room for the price to be wrong and for the fill to be worse than the picture. That is why the starting notes keep saying a hundredth of a lot. It is a teaching size, not a magic one.

If your stop is closer than the spread, you are not choosing a size. You are choosing to be out immediately. The order guide shows a 50-pip stop that the sample spread has already passed.

Margin is a different question

The cash the firm sets aside to keep the position open is margin. It is not the loss you decided you could stand, and it is not a cap. A small margin on a large lot is how a quiet hundred pips becomes the deposit. If the account is in dollars, or the pair is not quoted in rand, ignore this table and read the pip box on that ticket.

After a kind demo

A week of demo profits is not a reason to move up a lot. The demo’s spread was a photograph, and the live ticket will not owe you the same one. If you change anything after a good run, change the notes, not the size. The size moves only when you have written down a new loss you can still stand, and checked the spread against it again.