Odd Lot
A securities order for fewer than 100 shares, contrasted with a round lot of exactly 100 shares or a multiple thereof.
What is Odd Lot?
An odd lot is an order to buy or sell a quantity of shares that is not a multiple of 100. The standard trading unit (round lot) for most US equities is 100 shares; any order for fewer than 100 shares is an odd lot. Historically, odd lots faced worse execution because they were handled separately from the main exchange order book and often could not interact with standard limit orders. In modern electronic markets, odd lots are mostly executed similarly to round lots, though some exchanges still exclude them from the National Best Bid and Offer (NBBO) calculation. Odd lot trades are common among retail investors who cannot afford 100 shares of a high-priced stock. The term 'odd lot theory' historically suggested that tracking small retail odd-lot trades could provide a contrarian signal.
Example
An investor wants to buy $500 worth of shares in a stock trading at $175. Since $500 ÷ $175 ≈ 2.86 shares, they purchase 2 shares — an odd lot. With fractional share investing offered by many modern brokers, they could also buy exactly $500 worth (2.86 fractional shares), sidestepping the odd-lot classification entirely.
Source: SEC — Market Structure