This is arithmetic on the numbers you type: it is general information, not financial advice, and it does not tell you what to trade or how much to risk. Costs such as spread, commission, swap and slippage are not included, and position size is given in units of the instrument — convert to lots or contracts yourself. See the risk disclaimer.
Position sizing is the one part of trading that is fully under your control before the trade starts. It is also short enough to check by hand.
Risk amount = account size × risk %
A $10,000 account risking 1% puts $100 on the line. That $100 is 1R — one unit of risk, and the yardstick every other number on your trade is measured in.
Risk per unit = |entry − stop|
Buying at 1.2500 with a stop at 1.2450 risks 0.0050 per unit. The stop belongs where the trade is wrong, not where the loss feels comfortable.
Position size = risk amount ÷ risk per unit
$100 ÷ 0.0050 = 20,000 units. Move the stop further away and the position gets smaller: the loss stays $100 either way. That is the whole point.
If every trade risks 1R, a win of $300 on a $100 risk is +3R whatever the instrument or the account size that day. Your win rate and your average R together decide whether you make money — which is why a 40% win rate can beat a 70% one.
We do not answer that, and you should be wary of a tool that does. The right number depends on your account, your strategy, your drawdown tolerance and, if you trade a funded account, your firm’s rules. The calculator uses the number you enter.
The arithmetic is the same for all of them, because it works in units of the instrument. What differs is what a “unit” means: shares for stocks, coins or contracts for crypto, and base-currency units for forex, where 100,000 units is a standard lot. Futures trade in whole contracts with a fixed tick value, so round down to a whole number.
Because a small price distance to your stop needs a large position for the loss to reach your risk amount. Whether you can hold that position depends on your leverage and your broker’s margin requirement, which this calculator knows nothing about. Check before you place the trade.
No. They make the real loss slightly larger than the number shown, and they matter most when your stop is close. Some traders size a little smaller to absorb them.
No. The page does the arithmetic in your browser. Nothing is sent to a server, nothing is saved, and closing the tab discards it.
R is your risk on the trade: a 2R win makes twice what a loss at your stop would have cost. There is no universally good ratio, because it trades off against how often you win. A journal that records both is how you find out which combination works for you.
TradingSocial logs the size you planned against the trade you actually took, in R, and shows you the pattern over hundreds of trades. Free for 14 days of Pro — a card starts the trial, and cancelling before it ends costs nothing.
