Forex Lot Size & Risk Calculator
Determine exact lot sizing to ensure risk remains fixed to 1% of account capital.
How the Calculation Works
Read parameters and compute total exposure: multiply order quantity by contract unit multiplier.
Evaluate terminal return at the selected target price using strict financial mathematical boundary logic.
Deduct upfront capital commitments, taxes, or net debits to produce final net profit or loss realization.
Calculation Formula
Example Calculation
₹1,00,000 capital risking 1.5% with a 25-pip stop loss on USD/INR (₹855 pip value per standard lot).
Trading 0.07 lots ensures a 25-pip adverse move limits total loss strictly to ₹1,500.
Assumptions & Parameters
- Assumes uniform execution at stop-loss without price gaps.
Frequently Asked Questions
How is Forex position size calculated?
Position size is calculated by dividing your cash risk budget by (Stop Loss in pips multiplied by Pip value per standard lot).
Why is position sizing vital in currency markets?
High leverage in Forex can lead to rapid capital wipeout unless position size is calculated strictly from stop-loss distance.
What happens if my calculated lot size is smaller than 0.01?
Most brokers require a minimum order size of 0.01 micro lots. If your risk permits less, you must widen your stop or deposit additional capital.
Does this formula change for mini or micro accounts?
No. The formula calculates total lot units; 0.07 standard lots simply equals 0.7 mini lots or 7 micro lots.
Should I include broker commissions in risk sizing?
Yes. You can add expected commission costs directly to the stop-loss distance to ensure total friction is covered.
How do currency pairs with different pip values affect sizing?
Pairs with higher pip values in your account currency require smaller lot sizes for the same rupee risk.