Position size calculator
Decide what you are willing to lose, then let the stop tell you how big the position can be — not the other way round. This works in lots for forex and gold, and in contracts for anything you can price per point.
Size is an output, not a decision
The common mistake is to pick a lot size out of habit — "I trade one lot" — and then place the stop wherever the chart suggests. That makes every trade a different amount of money at risk, decided by whatever the volatility happened to be, and it means your worst losses arrive exactly when conditions are least predictable.
Turning it round fixes that. You fix the loss in advance, the chart decides the stop, and the size falls out of the arithmetic. Two consequences follow, and both are good. A wide stop gives a small position, which is right, because a setup needing that much room is a setup you are less sure of. And every loss costs the same, so a losing run is a straight line rather than a cliff.
Worked example
A $10,000 account, risking 0.5%, so $50. Long gold at $2,400 with the stop at $2,394 — a $6 move against you, plus say $0.30 of spread, giving $6.30 of real risk per ounce. $50 ÷ $6.30 = 7.9 ounces, which is 0.079 lots, rounded down to 0.07. At 0.07 lots the actual loss if stopped is $44, comfortably inside the $50 you allowed.
Round down, never up. Rounding 0.079 up to 0.08 puts $50 at risk exactly, and the first time the spread widens you are over your own limit.
What this looks like on a prop firm account
Apply the same arithmetic to a challenge and the numbers get uncomfortable quickly. On a $100,000 account with a 5% daily loss limit, risking 1% per trade means the fifth loss of the day closes you. Five losses in a day is not a disaster scenario — it is a Tuesday. At 0.25% you would need twenty, which is a different kind of day altogether and one you would have stopped trading long before.
Work out where your own limit sits with the prop firm drawdown calculator, then size so that a normal bad day cannot reach it.
Practise it with the stop actually at risk
Knowing the formula is the easy half. The hard half is holding the size you calculated when the setup looks obvious and you want more. TradeDrill replays real market days bar by bar with the future hidden, so you get to find out what you actually do — before it costs anything.
Questions
How do I calculate position size from a stop loss?
Take the amount you are willing to lose in cash (account size × risk %), then divide it by the distance between your entry and your stop measured in the instrument's value per point. The answer is your position size. Working in that order — risk first, size second — is what keeps a wider stop from quietly becoming a bigger loss.
What percentage should I risk per trade?
Most consistently profitable retail traders risk between 0.25% and 1% per trade. On a prop firm challenge the useful number is smaller than people expect: with a 5% daily loss limit, risking 1% means five losers in a day breaches you, and five losers in a day is an ordinary event.
What is one pip worth?
On a standard lot (100,000 units) of a USD-quoted pair such as EURUSD, one pip of 0.0001 is $10. On a JPY pair a pip is 0.01, worth roughly $6.50–$7 depending on the rate. On gold (XAUUSD) a standard lot is 100 ounces, so a $1 move is $100. This calculator handles all three.
Should the spread be part of my risk?
Yes. Your stop is hit on the far side of the spread, so the real distance is your stop distance plus the spread, and on a tight intraday stop that can be a surprising share of the total. Add it in and size for the real number.
These calculators are for education and planning. They are not financial advice, and no calculator can tell you whether a trade is a good idea. Trading carries risk of loss.