Free trading tools

    Position size calculator.

    The single most important risk decision you make on every trade. Enter your account size, risk tolerance, entry and stop - and know exactly how many shares to buy before you click.

    YOUR TRADE

    Most professionals risk 0.5-2% per trade. At 1%, a losing streak barely dents the account - and your edge still compounds.

    YOU SHOULD BUY
    250shares
    Risk amount$500.00
    Risk per share$2.00
    Total position cost$12,500.00
    Capital deployed50% of account
    WHY IT MATTERS

    Sizing is survival.

    Position sizing is the foundation of risk management - too large and one bad trade wipes out weeks of gains, too small and your winners never move the needle.

    01

    Cap the downside on every trade

    Professionals rarely risk more than 1-2% of their account on a single position. That ceiling means even a long losing streak won't meaningfully damage your capital - you live to trade another day.

    02

    Take emotion out of the entry

    By calculating size before you enter, you already know exactly what's at stake if the stop is hit. The decision is made in the cold light of math, not in the heat of a moving chart.

    03

    Read the result correctly

    The output is the maximum number of shares to buy. If the total cost runs past your account balance, that's your signal to lower the risk percentage or find a tighter stop - not to reach for margin.

    THE FORMULA

    Position size = Risk amount ÷ Risk per share

    Shares = (Account × Risk %)
           ÷ |Entry − Stop|
    WORKED EXAMPLE
    $25,000 account, risking 2%$500
    Entry $50.00, stop $48.00$2.00/sh
    Position size250 shares

    If the stock hits your stop, you lose exactly $500 - 2% of the account, by design.

    Position sizing, answered.

    What is position sizing in trading?
    Position sizing determines how many shares or contracts to buy or sell on a trade based on your account size, the percentage of capital you're willing to risk, and the distance between your entry price and stop loss. It's the most important risk management decision a trader makes on every trade.
    How do you calculate position size?
    Divide the dollar amount you're willing to risk (account balance × risk percentage) by the risk per share (the absolute difference between your entry price and stop loss). For example, if you have a $50,000 account, risk 1%, and your stop is $2 away from entry, your position size is ($50,000 × 0.01) ÷ $2 = 250 shares.
    What percentage should I risk per trade?
    Most professional traders risk between 0.5% and 2% of their account per trade. Risking 1% is a widely recommended starting point - it's aggressive enough to grow your account but conservative enough to survive a losing streak without significant drawdown.
    Does position sizing work for options and futures?
    Yes. The same principle applies: calculate how much you're willing to lose, then size your position so that if your stop is hit, the loss equals that amount. For options, your max risk on a long position is the premium paid, which simplifies the calculation.
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    Want this sized automatically?

    TradeOlogy tracks your trades and computes position size, risk, expectancy and more - so you never have to open a calculator again.

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