Position size calculator
The formula behind the position size calculator
A position size calculator reverses the usual question. Instead of choosing a lot size and discovering the risk afterwards, you fix the risk and let the lot size follow.
Lots = amount at risk ÷ (stop-loss in pips × pip value per lot)
Worked examples
Illustrative figures. An $8,000 account risking 1.5% per trade puts $120 at risk.
- EUR/USD, 30-pip stop: pip value per lot is $10, so 120 ÷ (30 × 10) = 0.4 lots.
- USD/JPY at 150.00, 40-pip stop: pip value per lot is 1,000 ÷ 150 ≈ $6.67, so 120 ÷ (40 × 6.67) ≈ 0.45 lots.
Same risk, different lot sizes: the wider stop and the lower pip value on the yen pair offset each other almost exactly in this case. Most platforms round to 0.01 lots, and rounding down keeps you inside your limit.
How to read the result
The output is the largest position that loses roughly your chosen amount if the stop is hit at its exact price. It does not include spread or commission, and a stop can fill worse than planned in a gap or fast market. Many traders keep the percentage small so that a string of losses leaves the account intact: ten consecutive 1% losses cost a little under 10% of the starting balance, while ten 5% losses cost about 40%.
Set the stop where the trade idea is proved wrong, then size the position. Moving the stop to fit a preferred lot size defeats the purpose. Check the margin the resulting position needs with the margin calculator, and see what one pip is worth in the pip calculator.