Position Size Calculator
A position size calculator tells you how many shares or contracts to buy so that hitting your stop loses a fixed share of your account. Divide the dollars you are willing to risk by the loss per share or per contract between entry and stop, then round down. Most traders risk 0.5% to 2% per trade.
For education only, not financial advice. Read the disclaimer.
HOW IT WORKS
risk dollars = account x risk % and risk per unit = |entry - stop| (times 100 for an option contract). Then size = floor(risk dollars / risk per unit). The result is always rounded down so a stop-out never costs more than you planned.
For options, enter the premium you pay and the premium at which you would exit. If you plan to hold to expiry, the stop is 0 and the whole premium is at risk. Gaps through a stop can cause larger losses than this calculation shows.