Rembember the pillar of salt? Lot's wife. Indiana Jones and the melting Nazis? Yeah, it's...not that.
In a financial context, a lot is a fixed quantity of units and defined by the exchange. For stocks, a round lot is a number that can be divided by 100. Odd lots are numbers less than 100, or numbers not divisible by 100. If you were to order a lot in a quantity that combined those two, such as 130, it's a mixed lot.
It would be broken into a round lot of 100, and an odd lot of 30. Exchange-traded securities work with lots of 100. Institutional investors buy debts from bond issuers in large quantities...U.S. government bonds start trading at $1 million. Municipal bonds start smaller, at $100,000. Lesser amounts are known as odd lots.
See: Round Lot. See: Odd Lot.
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Finance: What is a Round Lot?7 Views
Finance allah shmoop what is around a lot Well here's
a square lot and no there really isn't such a
things a square lots of don't write us so what's
around lot Well it's one hundred shares of stock and
or it can be any form or subset of shares
easily divisible by one hundred Why does this matter Because
one hundred years ago computers well they weren't even a
thing and brokerages manually did math on abacus is says
or abba chi or just you know on that graph
paper that grandpa has with this thing called a pencil
Yeah people actually use those things one hundred years ago
Well the odds of making a mistake from a non
round lot when shares were split or divided or sliced
and diced in some julian fry kind of way well
they were really high so the brokerages wanted to encourage
investors to buy and sell in round lots to make
both their jobs easier and to mitigate the risk of
errors Well historically brokerages would have to bundle non round
loss together such that they would truncate However many odd
shares were left after evenly dividing by one hundred in
order to do business with each other as they were
in disparate form all around the country in the world
and telecommunications was basically you know a guy shouting in
the street asking for buyers like check out this picture
of wall street's or you know nineteen twelve So what
is it called when someone wants to sell one hundred
thirty four point three shares it's a mixed lot Yeah
there's one unit of around a lot of one hundred
shares there and then there's thirty four point three shares
truncated or leftover as an odd lot and generally speaking
for a long time investors selling odd lots were punished
in the form of much higher commission rates that they
would pay in order to execute the trades of those
odd lots And eventually with computers and regulatory concern the
commission's minimized because if you think about it the people
paying the much higher commission rates were generally the poor
or disenfranchised or uneducated Otherwise they'd have enough dough to
just buy round lots right And after enough of them
got taken while the world finally figured out how to
smash that square peg into that round hole you know 00:02:18.04 --> [endTime] It works
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What is odd lot theory? Hm, how odd that you don't know...hit play to find out.