01 / At a glance
The essential MT5 glossary
These terms answer four different questions: where the market is priced, how far it can move, how large your order is and what that movement may mean for your account. Keeping those categories separate prevents many sizing mistakes.
| Term | Practical meaning |
|---|---|
| Lot / volume | The order size entered in MT5; its underlying contract size is symbol-specific. |
| Point | The symbol's point value, commonly 10 to the power of minus Digits; it is not necessarily the minimum tradable change. |
| Tick size | The minimum price change defined in the instrument specification. |
| Tick value | The broker-reported monetary value associated with one tick; MT5 can expose separate profit and loss values. |
| Spread | The difference between the current Ask and Bid prices. |
| Margin | Collateral required by the broker to support a leveraged position. |
| Equity | Balance adjusted by floating profit and loss, plus applicable account adjustments. |
| R | One unit of planned trade risk; a +2R result equals twice the amount initially risked. |
02 / Order size
Lots, volume and contract size
Volume is the number you enter in the MT5 order ticket. It is normally expressed in lots: 1.00, 0.10 or 0.01, for example. Contract size tells you what one full lot represents for that particular symbol.
The important distinction is that one lot is not universal. A broker can define a Forex lot, a Gold lot and an index CFD lot with different contract sizes. That is why copying the same volume from EURUSD to XAUUSD can create a completely different exposure.
Minimum volume
A broker rule that the final order volume must satisfy.
Maximum volume
A broker rule that the final order volume must satisfy.
Volume step
A broker rule that the final order volume must satisfy.
The official MQL5 symbol-property reference exposes contract size, minimum and maximum volume, and the permitted volume step for each instrument. See the MQL5 symbol properties.
03 / Price movement
Points, pips and ticks are not interchangeable
All three describe price movement, but they come from different conventions. A point relates to quote precision, a tick is a valid minimum price movement, and a pip is a widely used Forex convention rather than a universal MT5 property.
Point
On a five-digit EURUSD quote such as 1.08542, one point is typically 0.00001 because that is the displayed precision.
Pip
In common Forex language, one pip on many non-JPY pairs is 0.0001. On a five-digit quote, that convention equals ten points.
Tick
A tick is one valid minimum price increment for the instrument. Its size must be read from the symbol specification.
Do not assume that a ten-point move always equals one pip, or that a pip has the same cash value on every symbol. For automated risk calculations, tick size and tick value are the safer inputs.
04 / Monetary movement
Tick size tells distance; tick value tells money
Tick size is the minimum valid price change. Tick value is the broker-reported monetary value associated with that change, and MT5 can provide separate profit and loss values. Together they help connect the price distance between Entry and Stop Loss to a cash estimate.
Number of ticks = Price distance ÷ Tick size
Simplified value = Number of ticks × One-lot tick value × Volume
In practice, account-currency conversion and instrument-specific calculation modes add complexity. MT5 can estimate profit or loss for a planned volume between two prices, which is more reliable than forcing every market into a Forex pip shortcut.
05 / Market quote
Bid, Ask and spread
A market Buy normally opens at the Ask, while a market Sell normally opens at the Bid. The difference between Ask and Bid is the spread, an immediate transaction cost that can expand or contract.
Long entry
A market Buy normally opens at the Ask.
Short entry
A market Sell normally opens at the Bid.
Stop activation
The relevant quote side can affect when an SL is triggered.
A chart may visually emphasize one quote, so the apparent distance to an order level can differ from the executable price. Spread is therefore relevant both to entry quality and to the final result.
06 / Trade plan
Entry, Stop Loss and Take Profit
Entry is the intended opening price. Stop Loss is the level used to limit an adverse move, while Take Profit is a target that closes the position when price moves in the intended direction.
Entry
Where exposure begins
Stop Loss
Where planned risk is defined
Take Profit
Where planned reward is targeted
A Stop Loss is an order instruction, not a guarantee of an exact fill. Slippage or gaps can produce a worse exit. Learn how these levels define a target in the MT5 risk-to-reward guide.
07 / Account state
Balance, equity, margin and free margin
These values describe the account, not the quality of a trade. Balance reflects closed results and account operations. Equity varies with floating profit and loss and applicable account adjustments. Margin is reserved collateral, while free margin is the remaining capacity after used margin.
| Account value | What changes it | Common use |
|---|---|---|
| Balance | Closed trades and account operations | Stable percentage-risk base |
| Equity | Balance, floating P/L and applicable adjustments | Current account value |
| Margin | Open leveraged exposure | Collateral monitoring |
| Free margin | Equity minus used margin | Capacity for new exposure |
Risk is not margin
Leverage can reduce the margin required to open a trade without reducing the price movement to your Stop Loss. Planned risk must still be calculated from Entry, SL and volume.
08 / Risk language
Risk amount, position size and R
Risk amount is the cash you plan to lose if the Stop Loss is reached under the assumed execution. Position size is the volume chosen to align that estimate with the limit. R expresses outcomes relative to the initial planned risk.
If planned risk = €100:
−1R = −€100 · +1R = +€100 · +2R = +€200
This makes trades with different cash sizes comparable. It also separates sizing from the setup itself. See the complete MT5 position-size formula, then compare fixed and percentage risk.
09 / Execution
Market orders and pending orders
A market order requests immediate Buy or Sell execution under the symbol's current execution rules. A pending order waits for defined price conditions before it becomes eligible for execution. Both can include Stop Loss and Take Profit instructions when supported by the trading conditions.
Market execution
Prioritizes immediate entry, but the final fill can differ from the visible quote when price moves or liquidity changes.
Pending execution
Defines a future trigger or limit condition. The order may remain unfilled, fill partially or experience execution effects.
10 / FAQ
Frequently asked questions
Short answers to the MT5 terminology questions that most often affect risk calculations.
What is the difference between a pip and a point in MT5?
In MT5, Point is the symbol's point value, commonly 10 to the power of minus Digits. Tick size is the minimum price change, and it can differ from Point. Pip is a Forex market convention and can represent multiple points on fractional-pip quotes. Because conventions vary, calculations should use the symbol's actual tick size and monetary trade calculation.
Is one lot the same size on every MT5 symbol?
No. One lot is a volume unit, but the contract size behind it is defined per symbol by the broker. Forex, Gold, indices, energies and cryptocurrencies can all use different contract specifications.
Are margin and trade risk the same thing?
No. Margin is collateral reserved to support a leveraged position. Planned trade risk is the estimated loss between Entry and Stop Loss for the chosen volume. A trade may use little margin but still carry significant risk.
Why does tick value change between instruments or accounts?
Tick value depends on the instrument specification, trade direction and account currency conversion. Broker settings and current conversion rates can therefore make the monetary value different across symbols and accounts.
What is free margin in MetaTrader 5?
Free margin is the amount of equity not currently committed as margin. It helps determine whether the account can support new positions, but it does not define the planned loss at a Stop Loss.
Risk note
This material is educational and does not constitute financial advice. Trading involves risk. Calculations made before entry are estimates; spread, commissions, slippage, price gaps and execution conditions can change the realized result.
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