Position Size Calculator

Position Sizing solves only one problem completely under your control prior to entering into a trade — How much will I lose if I am incorrect? Before you place an order; fix the dollar loss amount based on the account size in dollars (percentage) and then through simple math the position size is determined. Because the position size is a direct function of the stop placement distance (a wide stop = smaller position / tighter stop = larger position), regardless of which market you are trading and time frame; each trade will risk the same percentage of your account.

The alternative, picking a lot size first and hoping the stop is survivable, is how accounts die: the same 1.00 lot that is conservative on EUR/USD is wildly aggressive on gold, because contract sizes and volatility differ by an order of magnitude between instruments.

lots = (balance × risk%) ÷ (stop distance × contract size × conversion rate)

where stop distance is in price units (pips × pip size, or |entry − stop|), contract size is the units per 1.00 lot, and conversion rate turns the instrument's quote currency into your account currency (it is 1 when they already match).

A worked example

A $10,000 account risks 1% on EUR/USD with a 20-pip stop. Risk budget: $100. One standard lot is 100,000 EUR, and a pip is 0.0001, so a 20-pip stop on one lot loses 20 × 0.0001 × 100,000 = $200. The quote currency is already USD, so no conversion:

lots = $100 ÷ $200 = 0.50 lots (50,000 EUR)

Same account, same 1%, but on gold with a $5.00 stop: one lot is 100 oz, so the stop on one lot loses 5.00 × 100 = $500, and the position is $100 ÷ $500 = 0.20 lots. Same risk, very different lot number, which is the entire point.

Where other calculators go wrong

Many have learned the hard way to never assume all instruments will behave like Forex. Index CFDs (and other products) are the mine field; with some brokers, you could find that one NAS100 lot can be priced at $1/point, while others price it at $5/point, $10/point, or even $20/point; a twenty fold difference in results from using identical input data. In oil, we see both 100 barrel CFD lots and 1,000 barrel futures. The position size tool provides reasonable default values for the majority of commonly traded products. It flags each product type where different brokers may use different sizes. Most importantly, it allows you to enter the specific contract size from your brokers specifications so you know what you're doing. A position size tool that does nothing but guess is as bad as having no such tool.

The main reason we can use just one tool to measure all of these trades (EUR/USD; Gold; Bitcoin; DAX) is simply because there are really only two numbers in play: the Contract Size (the amount of money in each trade lot), and how many Units one Lot contains. Therefore, the Risk Math used is virtually the same as well. When selecting an Instrument, the Calculator automatically loads the most commonly accepted Broker Convention for each. For example: Standard Forex Lot = 100,000 Units; Gold Spot = 100 oz; One Coin = Crypto Spot; Index Unit = Cash Indices. It will then either confirm this setting based on the Broker’s specifications or allow you to replace it with whatever they specify. All subsequent calculations – i.e., Pips/Points and the actual Lot Number – come from that first entry.

What trips people up is that the answer arrives in a different unit per market, and the word “lots” quietly shifts meaning. On forex it is lots of 100,000. On gold it is lots of 100 ounces. On spot crypto most people size in coins or dollars rather than lots, so set the contract size to 1 and read the result as the number of BTC or ETH. On futures, one “lot” is one exchange-defined contract, an MES or an MNQ, with a fixed multiplier per point. The calculator sizes all four; you only have to know which unit you are reading.

Sizing the stop from ATR

Many users will use a multiple of their average true range (atr) from the price they entered as a stop loss rather than entering a fixed dollar amount, thus allowing the stop loss to move with volatility. This does not require a special calculator as most charting packages have an atr value listed somewhere on the screen. Simply choose the multiple (1.5 and 2.0 are popular multiples) and put this into the box labeled "stop". With a larger atr, you automatically get a smaller size, or less exposure to a given market for the same level of account risk. Again, the method used to determine your stop distance is irrelevant, it simply determines what number you enter.