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Finance Dictionary and Glossary of Investment Terms
An amount of a security that is less than the normal unit of trading for that particular security.
A trading order for less than 100 shares of stock. Compare round lot.
Less than 100 shares of a stock; or less than 10 shares of a very thinly traded stock. Some brokerages charge higher commissions for such transactions (often 1/8 of a point per share, called the differential). also called broken lot or uneven lot. opposite of round lot.
When an investor buys or sells less than 100 shares, he or she is said to be trading an odd lot. Traditionally, odd lots involve higher proportional transaction costs than round lots. Some investors look to the ratio of odd-lot buying versus odd-lot selling to see what very small investors are doing, and then do the opposite. Odd lot theory, as it is known, is based on the idea that small investors usually are wrong.