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Calculate a theoretical share or contract quantity from account value, risk percentage, entry price and stop price.
Processed locally in this browser tab. No input is sent to an external service.
Calculate a theoretical share or contract quantity from account value, risk percentage, entry price and stop price.
A formula example only, not investment advice. It ignores fees, slippage, gaps, leverage rules and liquidity; losses can exceed the entered risk.
Calculate a theoretical share or contract quantity from account value, risk percentage, entry price and stop price.
A formula example only, not investment advice. It ignores fees, slippage, gaps, leverage rules and liquidity; losses can exceed the entered risk.
A formula example only, not investment advice. It ignores fees, slippage, gaps, leverage rules and liquidity; losses can exceed the entered risk.
Disciplined risk management dictates determining maximum allowable financial loss before entering any position. This calculator computes theoretical order sizing using total capital, risk percentage per trade (up to 100%), entry price, and stop-loss price. Cash risk equals account equity multiplied by risk ratio. Dividing cash risk by the absolute price difference (|entry - stop|) determines position quantity, which multiplies by entry price for total commitment across long or short trades.
Consider a hypothetical account containing $10,000 where an investor risks 2% ($200) on a trade. Planning an entry at $50 with a protective stop at $48 sets the risk distance to $2 per share. Dividing $200 by $2 indicates a position size of 100 shares ($5,000 total exposure). If the stop is widened to $45 ($5 risk distance), the formula caps the trade at 40 shares ($2,000 exposure), demonstrating how widening stops shrinks sizing to protect capital.
This tool outputs purely theoretical figures and is not trading advice or a trade recommendation. Results retain exact decimals without rounding to standard lot increments or checking account purchasing power limits. Slippage, exchange fees, and commissions are omitted, which may cause actual losses to exceed calculated risk. Computations occur locally inside your browser without external transmission.
No, the calculator displays the exact decimal quantity resulting from the formula. Traders must manually round or adjust to match their broker's specific increment rules.
No, the algorithm does not enforce cash purchasing constraints or margin ceilings. A narrow stop can produce theoretical position values higher than total capital.
No, the formula utilizes the absolute mathematical difference between entry and stop prices. It functions symmetrically for both long and short setups without directional mode selection.