Check the monetary and percentage risk a proposed position carries against your limits.
Risk is the stop distance times the share count, not the position value. A large position with a tight stop can carry less risk than a small one with a wide stop. Consistent risk per trade is what makes a strategy’s expectancy meaningful; variable risk means one bad trade can erase twenty good ones.
Position Size Risk
Risk % = shares × (entry − stop) ÷ account size × 100
Risk % = shares × (entry − stop) ÷ account size × 100 Risk is the stop distance times the share count, not the position value. A large position with a tight stop can carry less risk than a small one with a wide stop.
Consistent risk per trade is what makes a strategy’s expectancy meaningful; variable risk means one bad trade can erase twenty good ones.
This calculator takes 5 inputs: Shares in the position, Entry price, Stop-loss price, Account size, Maximum risk you accept per trade. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.