BrokersDB
📐

Position Size Calculator

Calculate the optimal lot size for your trades based on account balance, risk tolerance, and stop loss distance.

1Input Parameters

$
0.1% (Conservative)5%+ (Aggressive)

2Results

Recommended Position Size
0.2 lots
20,000 units
Risk Amount
$100.00
1% of balance
Standard Lots
0.2000
Exact value
Mini Lots
2.00
0.1 lot each
Micro Lots
20.0
0.01 lot each
Pip Value
$2.00
Per pip
Max Loss
-$100.00
If SL hit
✅ Conservative Risk — Excellent risk management

Most professional traders risk 1-2% per trade. This allows surviving 10+ consecutive losses.

📐 How Position Size Is Calculated

Formula:
Position Size (lots) = Risk Amount ÷ (Stop Loss in Pips × Pip Value per Lot)
= $100.00 ÷ (50 × $10) = 0.2000 lots
1
Risk Amount
Account × Risk % = $100.00
2
Pip Cost
SL Pips × Pip Value = $500 per lot
3
Divide
Risk ÷ Cost = 0.2000 lots
All Trading Tools

What Is Position Sizing?

Position sizing is the process of determining how many units (lots) to trade based on your account size, risk tolerance, and stop loss distance. It is arguably the most important aspect of risk management in trading.

Without proper position sizing, even a strategy with a 70% win rate can lead to account blowup. Conversely, correct position sizing can keep you in the game long enough for your edge to play out, even during inevitable losing streaks.

The Position Size Formula

The formula is straightforward:

Position Size (lots) = Risk Amount ÷ (Stop Loss in Pips × Pip Value per Standard Lot)

Where:

  • Risk Amount = Account Balance × Risk Percentage (e.g., $10,000 × 1% = $100)
  • Stop Loss in Pips = Distance from entry to your stop loss
  • Pip Value = The monetary value of one pip for one standard lot (~$10 for most USD pairs)

Why the 1-2% Rule?

Most professional traders risk between 1% and 2% of their account per trade. This is because:

  • At 1% risk, you can survive 100 consecutive losses before your account is depleted
  • At 2% risk, 50 consecutive losses would be needed
  • At 5% risk, only 20 consecutive losses would wipe you out
  • Even with a 50% win rate, 10+ losing streaks are statistically common

Lot Sizes in Forex

Forex positions are measured in lots:

  • Standard Lot = 100,000 units (~$10 per pip for USD pairs)
  • Mini Lot = 10,000 units (~$1 per pip)
  • Micro Lot = 1,000 units (~$0.10 per pip)
  • Nano Lot = 100 units (~$0.01 per pip)