# Position Size Calculator

> Free position size calculator. Enter your account size, risk percentage, entry and stop to see how many shares, contracts or coins to trade.

Source: https://learn.tradelabsai.com/tools/position-size-calculator/  
Track: Calculators · Level: Beginner · Updated: 2026-10-03  
Publisher: TradeLabs AI (https://tradelabsai.com). Education, not financial advice.  
Cite as: TradeLabs Learn, "Position Size Calculator", https://learn.tradelabsai.com/tools/position-size-calculator/

Position sizing is the most important number in any trade, and it is the one beginners most often guess. This calculator works it out from four inputs: how much money is in your account, what percentage of it you are willing to lose if the trade fails, where you will enter and where your stop loss sits. It returns the number of units to buy or sell so that hitting your stop costs exactly the amount you chose, no more. It works for shares, crypto, or any instrument priced per unit. For futures, use the [Futures Tick Value Calculator](https://learn.tradelabsai.com/tools/futures-tick-value-calculator/) to convert ticks into money first.

## Calculator

*Interactive calculator: use it at https://learn.tradelabsai.com/tools/position-size-calculator/*

## How it works

```
Money at risk = Account size × Risk per trade %
Position size = Money at risk / |Entry price - Stop price|
```

The distance between entry and stop is your risk per unit. Dividing the money you are willing to lose by that distance gives the size at which a stopped out trade costs exactly your chosen amount. The same formula works for long and short trades, because only the distance matters. See [Position Sizing](https://learn.tradelabsai.com/risk/position-sizing/) and [Fixed Percentage vs Fixed Dollar Risk](https://learn.tradelabsai.com/risk/fixed-percentage-risk/).

**Example: Sizing a stock trade**
A trader has a $10,000 account and risks 1% per trade, so $100. They plan to buy a stock at $50 with a stop at $48, a risk of $2 per share. Position size is $100 divided by $2, or 50 shares, worth $2,500, which is 25% of the account. If the stop is hit, the loss is 50 times $2, or $100, plus any slippage and fees. If the trader moved the stop to $49, the risk per share would fall to $1 and the position would double to 100 shares, with the same $100 at risk. See [Stop Loss Strategies](https://learn.tradelabsai.com/risk/stop-loss-strategies/).

## Choosing your risk percentage

| Risk per trade | Typical use |
|---|---|
| 0.25% to 0.5% | New traders, high frequency strategies, larger accounts |
| 0.5% to 1% | A common professional range |
| 1% to 2% | Experienced traders with tested strategies |
| Above 2% | Aggressive; long losing streaks can cause deep drawdowns |

With 1% risk, ten losing trades in a row cost about 9.6% of the account. With 5% risk, the same streak costs about 40%. Losing streaks happen even to good strategies. See [Losing and Winning Streaks](https://learn.tradelabsai.com/risk/losing-and-winning-streaks/) and [Risk of Ruin](https://learn.tradelabsai.com/risk/risk-of-ruin/).

## Things the calculator does not include

1. **Slippage and gaps:** stops can fill worse than planned, especially overnight or in fast markets. See [Slippage](https://learn.tradelabsai.com/markets/slippage/) and [Price Gaps and How to Trade Them](https://learn.tradelabsai.com/chart-patterns/price-gaps-and-how-to-trade-them/).
2. **Fees and commissions,** which add to the real loss. See [Commissions and Fees](https://learn.tradelabsai.com/orders/commissions-and-fees/).
3. **Leverage limits:** a tight stop can produce a position larger than your buying power. Check the "share of account" result. See [Margin and Leverage Calculator](https://learn.tradelabsai.com/tools/margin-and-leverage-calculator/).
4. **Correlation:** several positions in related assets add up to more risk. See [Portfolio Heat](https://learn.tradelabsai.com/risk/portfolio-heat/).
5. **Lot size rules:** round down to the units your broker allows, such as whole shares or minimum crypto increments.

## Using position sizing every trade

Make the calculation part of your pre trade routine: set the stop where the trade idea is proven wrong, then let the calculator decide size. Never move the stop to fit a size you wanted. See [Pre-Trade Checklist](https://learn.tradelabsai.com/start-here/pre-trade-checklist/) and [Building a Trading Plan](https://learn.tradelabsai.com/start-here/building-a-trading-plan/).

## Frequently asked questions

### How do I calculate position size?

Multiply your account size by the percentage you are willing to risk, then divide by the distance between your entry and stop loss price.

### What percentage of my account should I risk per trade?

Many traders risk between 0.5% and 2% per trade; smaller percentages keep losing streaks survivable.

### Does position sizing work for short trades?

Yes. The formula uses the distance between entry and stop, so it works the same for long and short positions.

Next, check whether a trade is worth taking with the [Risk/Reward Calculator](https://learn.tradelabsai.com/tools/risk-reward-calculator/).

## Continue learning

- Next lesson: [Risk/Reward Calculator](https://learn.tradelabsai.com/tools/risk-reward-calculator/)
- Related: [Lessons From Market Failures](https://learn.tradelabsai.com/history/lessons-from-market-failures/): Crashes, rogue traders and fund collapses share repeating patterns: leverage, concentration, illiquidity and weak controls. Learn the lessons for traders.
- Related: [Position Sizing](https://learn.tradelabsai.com/risk/position-sizing/): Position sizing decides how many shares or contracts to trade so each loss stays small. Learn the formula, worked examples for each market and common mistakes.
- Related: [Fixed Percentage vs Fixed Dollar Risk](https://learn.tradelabsai.com/risk/fixed-percentage-risk/): Fixed percentage risk sizes trades as a share of your current account; fixed dollar risk uses one amount. Compare drawdowns, growth and when to use each.
- Related: [Stop Loss Strategies](https://learn.tradelabsai.com/risk/stop-loss-strategies/): A good stop sits where your trade idea is proven wrong. Compare structure, volatility, percentage and time stops, with examples and the mistakes to avoid.
- Related: [Risk/Reward Calculator](https://learn.tradelabsai.com/tools/risk-reward-calculator/): Free risk reward calculator. Enter entry, stop and target prices to get the reward to risk ratio and the win rate you need to break even.
- Related: [Risk of Ruin](https://learn.tradelabsai.com/risk/risk-of-ruin/): Risk of ruin is the chance that losses drain your account beyond recovery. Learn what drives it, see simulated numbers and how to keep it low.