Risk calculator
Position size calculator
Work out how many shares or contracts to take so a stop costs exactly what you intended.
Position size is the part of a trade that is entirely within your control. The market decides whether the idea works; you decide what it costs when it does not. This calculator takes the amount you are willing to lose and the distance to your stop, and returns the size that makes those two numbers agree.
The arithmetic is simple enough to do in your head, which is precisely why it gets skipped in a hurry and why so many accounts are damaged by one trade sized like five.
Notes
- Risk per trade between 0.5 and 2 percent is the range most professionals work in.
- Two limits apply to every trade. Risk is what the stop costs you. Position value is what the shares cost to buy. Both have to fit.
- When position value exceeds your account the size needs margin, which usually means the stop is too tight for the risk you chose.
- Size from the stop you intend to use, never from the size you wish you could take.
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