Position Sizing
This tool helps you decide how many shares to buy based on how much you are willing to lose if the trade fails.
Why this matters
- Start with your risk. Decide how much money you are willing to lose before you decide position size.
- Bigger stop, smaller size. If the stop is farther away, you should usually buy fewer shares.
- Your stop should mean something. It should be the price where the trade idea is no longer valid.
- This tool keeps risk more consistent. It helps prevent one trade from becoming too large just because you feel confident.
Beginner Guide: What this tool actually does
What this tool is for
This calculator helps you decide how many shares to buy so that one losing trade does not damage your account more than planned.
How it works
You enter your account size, the percentage you want to risk on one trade, your entry price, and your stop price. The tool then estimates your maximum dollar risk, your risk per share, and how many shares fit that plan.
Why this matters
Many investors choose size based on conviction. That often leads to oversized positions. This tool does the opposite. It starts with risk first and lets size come from the plan.
What the target price is for
If you enter a target, the tool also shows the reward relative to the risk. This helps you judge whether the setup is worth taking.
What this tool does not do
It does not guarantee a good trade, account for slippage perfectly, or replace judgment. It is a risk-planning tool.