How is position size calculated?

Divide the dollars you are prepared to lose on the trade by the distance between the entry and the stop. With $250 of risk and a $2.00 stop distance, that is 125 shares. Whole shares round down, so the risk never exceeds the budget.

Does a stop-loss cap the loss at the dollars shown?

Not always. A stop order can fill below the stop price when a stock gaps or moves fast, so the real loss can be larger than the dollars at risk shown here. Commissions are not included either.

Free tool · Position size · no signup

Position size calculator for stocks and options Know your size before the trade.

Work out how many shares or option contracts fit your risk per trade from account size, entry and stop — with the dollars at risk and the position size.Risking $250.00 from $50.00 to a $48.00 stop allows 125 shares — a $6,250.00 position.

125

Dollars at risk

$250.00

1.00% of the account

Track your trades free Edit the inputs

Position value

$6,250.00

Position, % of account

25.0%

Risk per share

$2.00

Reward:risk

2.50 : 1

Your inputs

Example values are provided. Replace them with your own plan. Prices are in USD per share.

Account size ($)

Risk per trade (% of account)

Entry price ($/share)

Stop-loss price ($/share)

Target price ($/share, optional)

Adds the reward:risk ratio and the profit at the target.

Allow fractional shares

Your estimate

Shares: risk = shares × the distance from the entry to the stop, rounded down to whole shares so the budget is never exceeded. Contracts: the budget divided by one contract’s maximum loss.

Shares: 125 shares
Dollars at risk: $250.00
Risk budget: $250.00
Position value: $6,250.00
Position, % of account: 25.0%
Risk per share: $2.00
Direction: Long
Reward:risk: 2.50 : 1
Profit at the target: +$625.00

The stop is treated as filled exactly at the stop price. Gaps, slippage, commissions, margin rules and taxes are not modeled. This is a sizing estimate, not a recommendation.

Log the trade with its stop in a free YieldCove account: every result is measured in R against the risk you planned.

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Worked example

The default scenario, computed with this tool’s own math — replace the inputs above with your trade.

With a $25,000 account and 1% risk per trade, the plan can lose $250.00. An entry at $50.00 with a stop at $48.00 risks $2.00 a share, so 125 shares fit — a $6,250.00 position, 25% of the account. The target at $55.00 pays 2.50 : 1: +$625.00 if it is reached.

Risk budget: $250.00
Shares: 125 shares
Position value: $6,250.00
Reward:risk: 2.50 : 1
Profit at the target: +$625.00 · +2.5R

Common questions

What the numbers mean — and what they leave out.

How is position size calculated?: Divide the dollars you are prepared to lose on the trade by the distance between the entry and the stop. With $250 of risk and a $2.00 stop distance, that is 125 shares. Whole shares round down, so the risk never exceeds the budget.
Does a stop-loss cap the loss at the dollars shown?: Not always. A stop order can fill below the stop price when a stock gaps or moves fast, so the real loss can be larger than the dollars at risk shown here. Commissions are not included either.

The rest of the workbench

Every free tool, one click away — plus the terms behind these numbers.

Terms behind the numbers

Stocks to wheelLive volatility, dividends and earnings per ticker

Keep going

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