Position Size Calculator
Calculate the optimal lot size based on your risk tolerance. Never risk more than you can afford.
Calculator Settings
⚡ Results update automatically as you type
Results
Risk Management Best Practices
Recommended for beginners and long-term traders. Protects capital during losing streaks.
Suitable for experienced traders with proven strategies. Balance between growth and protection.
High risk approach. Only for very experienced traders with high win rates. Can lead to significant drawdowns.
📐 Position Size Formula
Position Size = (Account Balance × Risk %) / (Stop Loss in Pips × Pip Value) Position Size = ($10,000 × 1%) / (50 × $10) = $100 / $500 = 0.20 lots
Frequently Asked Questions
How do I calculate position size in forex?
Position size is calculated using the formula: Position Size = (Account Balance × Risk Percentage) / (Stop Loss in Pips × Pip Value). Our free position size calculator automatically computes the optimal lot size based on your account balance, risk tolerance, and stop-loss distance.
What is the 1% rule in forex trading?
The 1% rule means never risking more than 1% of your account balance on a single trade. If you have $10,000, your maximum risk per trade is $100. This position sizing rule protects your account from large drawdowns during losing streaks and is recommended for beginner traders.
What is the best position size for a $1000 account?
For a $1000 account with 1% risk ($10 per trade), use micro lots (0.01-0.05 lots) depending on your stop-loss distance. For a 20-pip stop on EUR/USD, your position size would be 0.05 lots. Our calculator helps you determine the exact size for any account balance.
How do I determine my stop loss distance?
Stop loss should be based on technical analysis - support/resistance levels, ATR (Average True Range), or price structure. Never adjust your stop loss to fit a desired position size; instead, adjust position size to fit your stop loss for proper risk management.
What's the difference between lots, mini lots, and micro lots?
Standard Lot: 100,000 units (~$10/pip for USD pairs)
Mini Lot: 10,000 units (~$1/pip for USD pairs)
Micro Lot: 1,000 units (~$0.10/pip for USD pairs)
Choose lot size based on your account balance and risk tolerance.
Why is proper position sizing important?
Proper position sizing is the foundation of forex risk management. It ensures you survive losing streaks, stay in the game long enough for your trading edge to play out, and prevents emotional trading decisions caused by oversized positions. Professional traders consider it more important than entry signals.
How much should I risk per trade as a beginner?
Beginners should risk 0.5% to 1% of their account per trade. As you develop consistency and a proven track record, you can gradually increase to 2%. Never risk more than 2% per trade, even with experience. Use our position size calculator to determine safe lot sizes.
Should I increase position size after winning trades?
Only if your account balance has increased. Always calculate position size based on current account balance, not recent performance. Avoid "revenge trading" with larger sizes after losses. Consistent position sizing based on percentage risk is key to long-term success.
How do I calculate lot size for different currency pairs?
Lot size calculation varies by currency pair due to different pip values. Our position size calculator automatically accounts for these differences. For non-USD pairs, the pip value must be converted to your account currency using current exchange rates before calculating position size.
Can I use this position size calculator for MT4/MT5?
Yes, our position size calculator works with MetaTrader 4, MetaTrader 5, cTrader, and all other trading platforms. Simply enter your values and use the calculated lot size when opening trades. The calculator supports all major and minor currency pairs with accurate pip value conversions.