Position Sizing Calculator
Calculate the correct lot size for any trade based on your account balance, risk percentage, and stop loss distance.
Based on standard forex lot (1 pip = $10 per lot). Adjust for your broker's specifications.
What is position sizing and why does it matter?
Position sizing determines how large a trade you take relative to your account. It is the single most important risk control a trader has. Without it, even a winning strategy can blow an account — because one oversized losing trade wipes out dozens of small wins.
The 1–2% rule
Most professional traders risk between 1% and 2% of their account per trade. At 1% risk, you can lose 20 trades in a row and still have 82% of your capital intact. At 10% risk, 10 consecutive losses mean your account is gone.
How to use this calculator
- Enter your total account balance in USD.
- Set the percentage of that balance you are willing to lose on this trade (typically 1–2%).
- Enter the distance from your entry to your stop loss in pips.
- The calculator returns your ideal lot size and the exact dollar amount at risk.
Formula
The $10 per pip figure applies to standard forex lots (100,000 units) on USD-quoted pairs. For mini lots (0.1), multiply pip value by 0.1.