Position Size Calculator
Enter your account size, the percent you are willing to risk, and your entry and stop-loss prices to see exactly how many shares to trade — and what a losing trade would cost.
Size a trade
Total trading capital, from $1 through $1 trillion.
The classic risk rule: 1–2% of the account per trade.
The price per share where you plan to open the trade.
A stop below the entry sizes a long trade; a stop above the entry sizes a short.
Risking $500.00 (1% of the account) with a $2.00 stop distance sizes a long position of 250 shares (≈ $10,000.00, 20% of the account).
- Dollar risk
- $500.00
- Risk per share
- $2.00
- Position value
- $10,000.00
- Share of account
- 20.00%
- Direction
- Long
How position size is calculated
This calculator uses fixed-fractional position sizing — the classic 1% risk rule. You choose the fraction of the account to risk on a single trade, which fixes the dollar risk. The distance between your entry and stop-loss prices is the risk per share, and dividing the dollar risk by that distance — rounded down to whole shares — sets the position size. Traders call that dollar risk 1R, after Van Tharp’s R-multiple framework: every profit or loss is measured in units of the initial risk, so sizing every trade to the same R keeps any one loss from doing outsized damage.
Shares = floor((Account × Risk%) ÷ |Entry − Stop|)- Account
- Total trading capital
- Risk%
- Percent of the account risked per trade
- Entry
- Planned entry price per share
- Stop
- Stop-loss price per share
A $50,000 account risking 1% on a $40 entry
Suppose you trade a $50,000 account and risk 1% per trade — a $500 dollar risk. You plan to buy at $40 with a stop-loss at $38, so the risk per share is $2. Dividing $500 by $2 and rounding down gives 250 shares: a long position worth $10,000, or 20% of the account. If the stop is hit, the loss is roughly $500 — one R.
This is an educational calculation based only on the values you provide. It does not look up live prices, and it is not trading advice.
What this calculator assumes
- Orders fill at your exact entry and stop prices — no slippage is modeled, and there is no guarantee a fast market will not gap through your stop for a larger loss.
- Share counts are rounded down to whole shares, so the actual dollar risk is at or slightly below your target.
- Margin requirements and buying power are not checked — the suggested position may exceed what your broker allows.
- This is an educational sizing aid, not trading or investment advice.
Position sizing FAQ
Why risk only 1–2% per trade?
Small per-trade risk keeps a losing streak survivable. At 1% risk, a run of 10 straight losses drains roughly 10% of the account — painful but recoverable. At 10% per trade, the same streak is ruinous, wiping out close to two-thirds of the account and requiring an outsized gain just to get back to even.
What is an R multiple?
R is the dollar amount you risk on a trade — the entry-to-stop distance times your share count. Profits are then measured in units of that initial risk: a trade that makes three times what you risked is a 3R win. Thinking in R keeps position sizes consistent and makes results comparable across trades.
Does this work for shorting?
Yes. Place your stop-loss above the entry price and the calculator flips the direction to short. The math is identical — the entry-to-stop distance is still the risk per share — only the side of the trade changes.
Sources and review notes
- FINRA — Day trading: margin requirements and risks
- Van Tharp, Trade Your Way to Financial Freedom, McGraw-Hill — R-multiples and position sizing
Methodology last checked Jul 16, 2026. Formula implementation is covered by deterministic unit tests. No financial professional review is claimed yet.