Position Size Calculator

To manage risk and to avoid blowing your account out on a single trade, position sizing is one of the most important tools in a trader's bag. This position size calculator will help you determine the approximate amount of stocks to buy or sell per position to control your maximum risk.

You can use the position size calculator to estimate the size of a position depending on the trade you make. Position sizing is important because it helps your account stay healthy and ready for the next opportunity.

The percentage of your entire portfolio you are willing to lose on a single trade.
The total amount of money you have available to trade.
The price you will buy the stock at.
The maximum loss you will incur if you liquidate your position.

Position size is calculated according to the risks you are willing to accept on that single trade (percentage of your entire portfolio you are willing to lose), portfolio size, stock entry price and stop-loss price (the maximum loss you will incur if you liquidate your position). It is possible to set the stop-loss price higher or lower than the stock price (hence you can use the calculator to take a short position as well).

Position Size Calculator FAQs

What is risk management system in stock market?

Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these and earn maximum returns.

How do you calculate position size in trading?

The best position size for a trade is determined by dividing the money you’re risking on that position by your trade risk.

How important is position sizing?

The size of your position is determined by the risk per trade you take. It will tell you the number of shares, lots, or contracts to buy or sell for each trade.

How much should you risk per trade?

1% of your capital is a good starting point for the amount of money you should risk per trade.