Position Size Calculator
Determine exact share quantity so trade loss is strictly capped at 1% to 2% of capital.
Professional trade parameters advise risking at most 1% to 2% of equity per transaction.
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
₹2,00,000 capital risking 1.5% with entry at ₹450 and stop-loss at ₹435.
Risk per share is ₹15. Allowable risk is ₹3,000. ₹3,000 / ₹15 = exactly 200 shares.
Assumptions & Parameters
- Quantities are rounded down to conservative whole integers to prevent exceeding risk.
Frequently Asked Questions
What is a position size calculator?
A position size calculator determines the exact number of shares or lots to trade so your maximum loss matches your risk budget.
Why should risk per trade be capped at 1% to 2%?
Limiting risk to 1-2% protects your account from severe drawdown during normal losing streaks.
How is position size computed mathematically?
Divide total allowable rupee risk (Capital × Risk %) by risk per share (Entry Price minus Stop Loss).
What happens if stop-loss distance is very tight?
A tight stop increases allowable share quantity for the same risk budget, but increases the chance of being stopped out by market noise.
Does position sizing guarantee profitability?
No. Position sizing controls downside risk; profitability depends on edge, win rate, and risk/reward ratio.
How does capital utilization differ from risk percentage?
Capital utilization is the total position value divided by account equity; risk percentage is the portion lost if stop-loss is hit.