Calculators
Position Size Calculator
Turn a risk budget and a stop-loss into a concrete position size, the boring discipline that keeps traders alive.
Position size calculator
Professionals decide how big a trade should be from a fixed risk budget and where their stop-loss sits, not from how confident they feel. You pick the most you’re willing to lose on the idea (a small slice of the account), and the distance to your stop tells you exactly how many shares that allows. This keeps any single losing trade small and survivable, so a rough streak never ends the game. Size follows the math, not the mood.
Per-unit risk (entry − stop): $5.00 per share.
Bars are scaled to your full account. Notice how a large position can ride on a tiny risk budget, that gap is the whole point of sizing off the stop.
You risk 1R = $100.00 if price hits your stop. A 2R target at $110.00 would return twice that, $200.00, for a 2:1 reward-to-risk trade.
Educational tool, not investment advice. Assumes fills at your exact entry and stop; real slippage, gaps, and fees will vary.
Learn how it works
Five worked examples. Read a couple before you dive in, try to answer first, then reveal the solution.
The basic sizing calculation
Account = $10,000. Risk per trade = 1%. Entry = $100, stop-loss = $95. How many shares should you buy, and how big is the position? Also: where does a 2R profit target sit?
- Dollar risk = account × risk%
- Per-share risk = |entry − stop|
- Shares = floor(dollar risk ÷ per-share risk)
Show solution
- Dollar risk = $10,000 × 1% = $100
- Per-share risk = |100 − 95| = $5
- Shares = floor($100 ÷ $5) = 20 shares
- Position value = 20 × $100 = $2,000
You hold $2,000 of stock but only risk $100: if the $95 stop is hit, 20 × $5 = $100 is lost, exactly 1% of the account. That $100 of risk is your 1R. A 2R target sits twice as far from entry as the stop: $100 + 2 × $5 = $110, where you would make $200.
A tighter stop lets you buy more
Same account ($10,000, 1% risk, entry $100) but a tighter stop at $98. How many shares now?
Show solution
- Dollar risk = $100 (unchanged)
- Per-share risk = |100 − 98| = $2
- Shares = floor($100 ÷ $2) = 50 shares
- Position value = 50 × $100 = $5,000
The stop is closer, so each share can lose only $2, meaning you can hold more shares (50 vs 20) for the same $100 of risk. Tighter stop → bigger position, but less breathing room before you get stopped out.
A wider stop means fewer shares
Same account ($10,000, 1% risk, entry $100) but a wider stop at $90. How many shares?
Show solution
- Dollar risk = $100
- Per-share risk = |100 − 90| = $10
- Shares = floor($100 ÷ $10) = 10 shares
- Position value = 10 × $100 = $1,000
Giving the trade $10 of room means each share risks more, so you must hold fewer shares (10) to keep the loss at $100. Wider stop → smaller position. The dollar risk stays fixed at $100; only the share count flexes.
Doubling the risk % doubles the size
Same setup (entry $100, stop $95) but you risk 2% of the $10,000 account instead of 1%. How many shares?
Show solution
- Dollar risk = $10,000 × 2% = $200
- Per-share risk = |100 − 95| = $5
- Shares = floor($200 ÷ $5) = 40 shares
- Position value = 40 × $100 = $4,000
Doubling the risk budget (1% → 2%) doubles everything: 40 shares instead of 20, a $4,000 position instead of $2,000, $200 at stake instead of $100. Bigger potential gain, but also a bigger drawdown when the trade is wrong.
Thinking in R-multiples
Using the base trade (entry $100, stop $95, 20 shares, $100 of risk), what do the 1R, 2R, and 3R targets look like, and why is R a useful unit?
Show solution
Your 1R = $5 per share = $100 total (the initial risk). Targets are simply multiples of that distance:
- 1R target = $100 + $5 = $105 → +$100 profit (reward:risk 1:1)
- 2R target = $100 + 2 × $5 = $110 → +$200 profit (2:1)
- 3R target = $100 + 3 × $5 = $115 → +$300 profit (3:1)
Measuring wins and losses in R (multiples of your initial risk) makes every trade comparable regardless of price or share count. If your average winner is +2R and your average loser is −1R, you can be right less than half the time and still come out ahead.
What you'll learn
How professionals size a trade from a fixed risk budget, and why risk-per-trade, not conviction, should decide how big you go.