Position Size Calculator (Risk-Based)
Professional risk management starts from the loss, not the upside. You decide how much of your account you are willing to lose on one trade, set a stop where your idea is wrong, and let those two numbers determine the position size — not a gut feeling about how much to buy. Enter your account size, risk percentage, entry, and stop to get the share count that keeps every trade's downside fixed.
Shares to buy
100
Risk on this trade
$500
Position value
$10,000
Position as % of account
20.0%
Risk per share:
Position size = (account × risk%) ÷ (entry − stop). Shares are rounded down. Ignores commissions, slippage, and gaps through your stop. A planning aid for risk sizing, not advice.
Why size from risk, not conviction
If you risk a fixed 1% of the account on every trade, no single loss can do serious damage, and your results come from the quality of your process over many trades rather than one oversized bet. Sizing from conviction does the opposite: the trades you feel most sure about get the biggest positions, which is exactly when an unexpected loss hurts most. A fixed-risk rule removes that emotional bias.
How the math works
The risk on a trade is the distance between your entry and your stop, multiplied by the number of shares. To hold that risk to a set dollar amount, divide the dollars you'll risk (account × risk%) by the per-share risk (entry − stop). The result is the maximum shares you can hold while keeping the loss at your chosen limit if the stop triggers. A tighter stop lets you hold more shares for the same risk; a wider stop, fewer.
What it does not cover
This is a sizing aid, not advice. It assumes your stop fills at the stated price — real markets gap, and a stop can fill worse, so treat the risk figure as a floor on the loss, not a guarantee. It ignores commissions, slippage, and the correlation between positions (five '1% risk' trades in the same sector are not really 1% risk). Size each trade here, but manage total portfolio exposure separately.
FAQ
What risk percentage should I use?
Many systematic traders cap single-trade risk at 0.5%–2% of the account. Lower is more conservative and survives losing streaks better. The right number depends on your strategy's win rate and your tolerance, not on how good a single trade looks.
Why did the share count drop when I widened my stop?
A wider stop means more risk per share, so fewer shares keep the same total dollar risk. Position size and stop distance move in opposite directions for a fixed risk budget — that trade-off is the whole point of risk-based sizing.
Does this guarantee my maximum loss?
No. It fixes the loss only if your stop fills at the entered price. Gaps, low liquidity, and fast moves can fill a stop worse, so the real loss can exceed the figure. Treat it as a disciplined estimate, not a guarantee.