What is round lot?
It's shares of a security in a trading order that numbers 100 or multiples of 100, such as 1800 or 2300. A round lot on an exchange is the normal trading unit. It is used for convenience when trading large amounts of shares.
Where have you heard about round lot?
If you are an investor you will have come across round lots when dealing with a broker on an exchange. A dealer or broker can buy or sell any number of shares but traditionally deals in multiples of 100.
What you need to know about round lot.
Most investors buy and sell shares in securities in large amounts so it makes sense to use multiples of an even number. The trade is also cheaper because a broker will charge more for the inconvenience if they have to deal with small or odd numbers.
If a lot has less than 100 shares or the amount is not even it is called an odd lot. If various lots together don't add up to a multiple of 100 it is called a multiple lot.
Round lot is also called even lot, lot, normal trading unit.
Find out more about round lot.
To find out more about round lot, see our definition of exchanges.