Gold moves a lot further in a day than most forex pairs, so a lot size that feels normal on EURUSD can carry several times the risk on XAUUSD. The calculation is simple once you know two numbers: your broker's contract size and your stop distance in dollars.
What one lot of gold means
At most brokers, 1.00 lot of XAUUSD stands for 100 troy ounces. That tells you what a $1 move in the gold price is worth:
- 1.00 lot: $100
- 0.10 lots: $10
- 0.01 lots: $1
These figures only hold for a contract size of 100. Some brokers list mini or micro gold symbols with 10 ounces or 1 ounce per lot. In MT5, right-click the symbol in Market Watch, choose "Specification" and look for "Contract size".
What a $1 move in gold costs: $100 on 1.00 lot, $10 on 0.10 lots and $1 on 0.01 lots, at 100 ounces per lot
The gold position size formula
Lots = risk amount ÷ (stop distance in $ × contract size)
The risk amount is your balance times your risk per trade. The stop distance is the difference between your entry and your stop loss in the gold price. The price level itself does not matter, only the distance.
Example 1: $10,000 account
Risk 1%, entry at 4,000.00, stop at 3,992.00.
- Risk amount: $10,000 × 1% = $100
- Stop distance: $8
- Loss of one lot at the stop: $8 × 100 = $800
- Lots: $100 ÷ $800 = 0.125
Rounded down to a 0.01 lot step, that is 0.12 lots. A stop-loss hit costs $96.
Example 2: $100,000 prop firm account
Risk 0.5% ($500), stop distance $12.
One lot loses $12 × 100 = $1,200 at the stop. $500 ÷ $1,200 = 0.4166, rounded down to 0.41 lots. A stop-loss hit costs $492.
On a funded account, check that number against your daily loss limit as well. With a 5% daily limit of $5,000, this trade uses about a tenth of the day's room. The prop firm drawdown calculator shows where your limits sit today.
Example 3: account in pounds or euros
Gold is quoted in US dollars. If your account is in another currency, convert the loss at the stop first.
£5,000 account, risk 1% (£50), stop distance $6, GBPUSD at 1.25.
- Loss of one lot at the stop: $6 × 100 = $600
- In pounds: $600 ÷ 1.25 = £480
- Lots: £50 ÷ £480 = 0.104, rounded down to 0.10 lots
Three gold examples: $10,000 account 0.12 lots, $100,000 prop firm account 0.41 lots, £5,000 account 0.10 lots
When the minimum lot is already too big
$500 account, risk 1% ($5), stop distance $8.
Even the smallest size of 0.01 lots loses $8 at the stop. That is 1.6% of the account, more than planned. You have three clean options:
- Look for an entry where the stop is no more than $5 away.
- Switch to a symbol with a smaller contract, if your broker offers one.
- Skip the trade.
Moving the stop closer just to make the numbers fit is not one of them. The stop belongs where your trade idea is wrong.
Pips, points and dollars on gold
Most gold sizing errors come from the word "pip", which is not used consistently on XAUUSD.
- A point is the smallest price change. With two decimal places, that is $0.01.
- Many traders call $0.10 a pip. Then 80 pips are a distance of $8.
- Others mean $0.01 by a pip. Then 80 pips would be only $0.80.
Work in dollars of price distance on gold. If a calculator or a signal asks for "pips", check which definition it uses first.
Common mistakes on gold
- Reusing a forex lot size. 0.50 lots with a 20-pip stop on EURUSD risks $100. 0.50 lots of gold with an $8 stop risks $400.
- Not checking the contract size. On a micro symbol with 1 ounce per lot, the correct lot size is a hundred times larger.
- Forgetting the spread. It is often wider on gold than on major forex pairs and widens around news. A very tight stop can be hit by the spread alone.
- Rounding up. 0.125 lots becomes 0.12, not 0.13.
Calculator and EA
The free position size calculator has a gold mode. Enter your balance, risk and stop distance, and it returns the lot size rounded down to your lot step.
For forex pairs and indices, see how to calculate position size.
In MetaTrader 5, the ProRisk Manager EA does the sizing on the chart: you drag the stop-loss line and the panel shows the lot size for your risk, calculated with your broker's symbol data.