The Lot Size represents the standardized number of a financial instrument as set out by the exchange. When trading stocks, the lot size refers to the number of shares you buy in one transaction.
When trading Options/Futures, the Lot Size (contract size) refers to the total number of contracts contained in one derivative security. The Lot Size is determined by the stock exchange.

How a Lot size works

When investors and traders purchase and sell financial instruments in the capital markets, they do so with lots. A lot is a fixed quantity of units and depends on the financial security traded.

For stocks, the typical lot size was round lots of 100 shares for many years, until the advent of online trading. A round lot can also refer to several shares that can evenly be divided by 100, such as 300, 1,200, and 15,500 shares.1

However, now odd lots, which is an order for less than 100 shares, and mixed lots—many shares above 100 but not divisible by 100—are more common. Similar to stocks, the round lot for exchange-traded securities, such as an exchange-traded fund (ETF), is 100 shares.