Position Size Calculator
Position sizing turns a risk rule into a share or unit count: it answers how many to hold so that, if the stop-loss is reached, the loss equals a fixed small portion of the account chosen in advance. It governs the size of a loss, not the chance of a win — and the figure is only as honest as the assumption that the stop actually fills at its price.
Quantity = (account size × risk %) ÷ (distance from entry to stop), floored to whole units. The first bracket is the cash put on the line; the second is what one unit loses if the stop is reached, so dividing gives the largest quantity whose loss, if the stop fills at its price, stays inside that limit.
Worked example: On a $10,000 account risking 1%, the cash on the line is $100. With a $100 entry and a $95 stop, each share can lose $5, so the quantity works out to $100 ÷ $5 = 20 shares — a $100 loss if the stop fills at $95, though a gap or slippage can cost more.
This figure sizes the loss accepted, not the odds the trade works, and it treats the stop as filling exactly at its price — a gap, thin liquidity or fees can make the real loss larger. Educational tool, not advice.
Treat the capital at risk as a best-case loss, reached only on a clean fill at the stop: gaps, slippage and fees all push the true loss past it, and a wider stop on the same risk budget simply yields fewer units, not a safer trade. The number scales the downside precisely; it says nothing about whether the idea has an edge.
How is position size calculated from account risk?
Multiply the account by the chosen risk percentage to get the cash at stake, then divide that by the per-unit distance from entry to stop; flooring the result gives the quantity whose loss, if the stop fills at its price, holds inside the limit. A $100 risk budget over a $5 stop distance works out to 20 units.
What makes the real loss exceed the capital at risk?
A stop that does not fill at its level. The figure assumes the exit trades exactly at the stop price, but an overnight gap, thin liquidity or slippage can fill it worse, and fees add to the bill — so the capital-at-risk line is a best case, not a guaranteed maximum.
Why is the share count rounded down?
Flooring keeps the loss, if the stop fills at its price, at or below the limit that was set. Rounding up would add a fraction of a unit and carry it beyond the cash at stake, so the calculator always floors the quantity — a smaller, truthful figure over a larger one that quietly breaks the rule.
A free, interactive calculator for any blog, newsletter or forum — same numbers as here, and it links back.
<iframe src="https://stratsemble.com/embed/tools/position-size-calculator" width="460" height="430" style="border:0;border-radius:12px;max-width:100%" loading="lazy" title="Position size calculator — Stratsemble"></iframe>A calculator shows what a rule should do on paper. A backtest is how you find the rare few that actually beat simply buying and holding — costs on, losses shown, no look-ahead — so when you build one that survives, you'll know it isn't a fake edge, and can prove it forward before you risk real money. It won't tell you you'll win — nothing honest can.