Unit of trading

Unit of trading

Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Unit of Trading

1. One thing that may be exchanged. For example, one dollar is a unit of money.

2. See: Lot.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

unit of trading

The minimum quantity of a security required for regular trading purposes. The unit of trading for most stocks is 100 shares. Also called trading unit, unit.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Unit of trading.

When you buy stocks, bonds, options and commodities futures, it's typical to buy in a particular volume or a particular dollar value, called a round lot or a unit of trading.

For example, stocks are usually traded in lots of 100 shares, or multiples of 100 shares, and bonds in multiples of $1,000. For some preferred stocks, known as ten-share traders, the unit of trading is ten shares.

Any variation from the standard unit of trading is known as an odd lot.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
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