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Position Size Calculator

Computes how many shares (or units) to buy or short so that hitting the stop-loss loses a fixed percentage of the account, using the fixed-fractional method: risk amount divided by the risk per share.

When to use

You have an entry and stop-loss price and want the number of shares that keeps the potential loss at a chosen fraction of the account.

Do not use when: You want the mathematically optimal fraction to bet from a known edge (Kelly criterion) or the reward side of the trade (use risk-reward-ratio). Informational only; not financial advice.

Formula

risk_amount = account_size × risk_percent/100; risk_per_share = |entry_price − stop_loss_price|; shares = floor(risk_amount / risk_per_share); position_value = shares × entry_price

Fixed-fractional position sizing: the loss at the stop, not the position value, is held to a constant fraction of capital. Slippage, gaps through the stop and commissions can make the real loss larger. Informational mathematics only; not financial advice.

Inputs

Parameter	Type	Unit	Required	Description
`account_size`	number		yes	Total trading capital. Range: > 0, ≤ 1000000000000
`risk_percent`	number	%	yes	Share of the account you are willing to lose if the stop is hit (commonly 0.5–2 %). Range: > 0, ≤ 100
`entry_price`	number		yes	Planned entry price per share or unit. Range: > 0, ≤ 1000000000
`stop_loss_price`	number		yes	Price at which the trade is exited at a loss; below the entry for a long, above it for a short. Range: ≥ 0, ≤ 1000000000

Outputs

Output	Type	Unit	Description
`risk_amount`	number		account_size × risk_percent / 100.
`risk_per_share`	number		\|entry_price − stop_loss_price\|.
`stop_distance_percent`	number	%	risk_per_share / entry_price × 100.
`shares`	integer		floor(risk_amount / risk_per_share).
`position_value`	number		shares × entry_price.
`position_percent_of_account`	number	%	position_value / account_size × 100 (above 100 % requires leverage).
`actual_risk_amount`	number		shares × risk_per_share.
`direction`	string		Long when the stop is below the entry, short when above.

Example

50,000 account, 1 % risk, entry 100, stop 95: {"account_size":50000,"risk_percent":1,"entry_price":100,"stop_loss_price":95} → {"risk_amount":500,"risk_per_share":5,"stop_distance_percent":5,"shares":100,"position_value":10000,"position_percent_of_account":20,"actual_risk_amount":500,"direction":"Long (stop-loss below entry)"}

Short: 20,000 account, 2 % risk, entry 40, stop 42: {"account_size":20000,"risk_percent":2,"entry_price":40,"stop_loss_price":42} → {"risk_amount":400,"risk_per_share":2,"shares":200,"position_value":8000,"position_percent_of_account":40,"direction":"Short (stop-loss above entry)"}

GET https://tttkmbb.com/api/v1/calculate/position-sizing?account_size=50000&risk_percent=1&entry_price=100&stop_loss_price=95

Machine access

API: GET https://tttkmbb.com/api/v1/calculate/position-sizing (query parameters) or POST with a JSON body {"inputs": {...}}
Schema: https://tttkmbb.com/api/v1/calculators/position-sizing · Markdown: https://tttkmbb.com/investing/position-sizing.md · JSON definition: https://tttkmbb.com/investing/position-sizing.json
MCP: server https://tttkmbb.com/mcp, tool run_calculator with calculator_id="position-sizing"
OpenAPI operationId: calculate_position_size
Freshness: static. Authentication: none. Rate limit: fair use (see rate limits).

Sources

Britannica Money – Calculating position size in trading (reference)
Wikipedia – Risk return ratio (reference)

FAQ

Why is the share count rounded down?

Rounding up would risk more than the chosen percentage; flooring keeps the actual risk at or below the target, which actual_risk_amount reports.

What if the position is larger than the account?

A tight stop can imply a position above 100 % of capital; that requires margin and the calculator flags it in the position percentage rather than capping it.

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Maximum Drawdown Calculator — Largest peak-to-trough loss of an equity curve.