Position Sizing By Risk
Calculator
Results
- Amount at risk
- 1,000
- Risk per share
- 8
- Number of shares
- 125
- Position value
- 12,500
Investing results
| Amount at risk | 1,000 |
| Risk per share | 8 |
| Number of shares | 125 |
| Position value | 12,500 |
formula-map diagram
- Amount at risk
- 1,000
- Risk per share
- 8
- Number of shares
- 125
- Position value
- 12,500
Investing relationship
Formula
Shares = (account × risk %) ÷ |entry − stop|= 1000
Note
This is not investment advice. It is a simplified model: it applies the displayed standard formula to the figures you entered, ignores taxes, fees, currency effects and credit risk, and assumes cash flows arrive exactly as scheduled. Real markets do not behave that way, and past or projected returns do not guarantee future results. Check the assumptions and consult a licensed adviser before acting on any figure.
More in Investing and markets
See all →Frequently asked questions
How does position sizing by risk determine trade size?+
The calculator divides the dollar amount you're willing to risk on a trade by the per-share (or per-unit) risk — the difference between your entry price and your stop-loss price — to determine how many shares or units to buy while keeping your total risk at your intended dollar amount.
Why use a percentage of account balance rather than a fixed dollar risk amount?+
Using a percentage (like risking 1-2% of account equity per trade) automatically scales position size as your account grows or shrinks, keeping risk proportional over time, whereas a fixed dollar amount doesn't adjust and can become disproportionately large or small as your capital changes.
What happens to position size if I set a tighter stop-loss?+
A tighter stop-loss (smaller distance between entry and stop) reduces the per-unit risk, which allows for a larger position size while keeping total dollar risk the same — but it also means the trade is more likely to be stopped out by normal price fluctuation.
Does this calculation account for the total capital required for the position, not just the risk?+
No, position sizing by risk only tells you how many units keeps your risk at the target level — you separately need to confirm the total position value (units multiplied by price) doesn't exceed your available capital or a desired maximum allocation per trade.
Is risk-based position sizing a guarantee against losses?+
No — it only controls how much you lose if the stop-loss is triggered as planned; gaps, slippage, or a stop that isn't executed at the expected price can all result in a larger loss than calculated. This is general information, not personalized investment advice.