Finance & trading
How many shares should you buy for a 1% risk trade?
How much to invest per trade based on capital, risk % and stop loss.
Quick answer
Units = (capital × risk%) ÷ |entry − stop loss|. €10,000 capital, 1% risk (€100), entry €50, stop €47: risk per unit = €3 → 100 ÷ 3 = 33.33 units. Position value = 33.33 × €50 ≈ €1,667 — only 16.7% of capital, but max loss is capped at €100.
Units to buy
33.33
- Position value
- ,666.67
- Maximum risk
- 00.00
- Risk per unit
- $3.00
How it works
Position sizing separates professionals from gamblers. Risk 0.5–2% of capital per trade so a string of losses does not wipe the account. Wider stops mean fewer units for the same dollar risk.
Frequently asked questions
What risk percentage per trade?+
Conservative: 0.5–1%. Aggressive: 1–2%. Above 2% per trade, a five-loss streak costs 10%+ of the account — hard to recover psychologically and mathematically.
Where should I place the stop loss?+
Below technical support (long) or above resistance (short) — not an arbitrary percentage. The stop defines risk; position size adapts to stop distance. Tighter stops are not always better if they get hit by noise.
Can I risk more on high-conviction trades?+
Conviction is not edge. Size up slightly (e.g. 1.5% vs 1%) if you must, but doubling risk on "sure things" is how accounts blow up — markets disagree often.
Position size for forex lots?+
Same formula: risk amount ÷ (stop in pips × pip value per lot). Pip value depends on pair and lot size (standard lot = 100,000 units). Many brokers offer position-size calculators built in.
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