Position Size Calculator
पोजीशन साइज कैलकुलेटर
Works out how many shares to buy so that being wrong costs you a fixed, pre-decided percentage of your capital — not whatever the market happens to take.
Free · no sign-up · by Rohit Singh (Mr. Chartist) · Updated 2026-08-25
Enter capital, risk percent, entry and stop. The stop must differ from the entry — if it does not, the trade has no defined invalidation and no size can be calculated for it.
Position sizing is the one decision in a trade that is entirely inside your control. You cannot make a setup work, you cannot stop a gap, and you cannot know in advance which trade is the loser. What you can decide, before you enter, is exactly how much being wrong will cost — and the number of shares is the lever that sets it.
The arithmetic is simple and almost nobody does it. Most traders decide the quantity from what feels affordable, or from a round lot, or from what the margin allows. That means the loss is set by the stop distance rather than by any decision they made: a wide stop quietly becomes a large loss, a tight stop a small one, and risk swings trade to trade with no one steering it.
Sizing from risk inverts that. You fix the loss first — one percent of capital, say — measure the distance from entry to the price that proves the setup wrong, and divide. The quantity falls out of it. A wide invalidation produces a small position, a tight one a larger position, and the rupee risk stays identical across both. That consistency is what lets a strategy's edge actually show up over a run of trades instead of being drowned by one oversized loss.
The formula
Position size = (Capital × Risk %) ÷ (Entry price − Stop-loss price)- Capital
- The total capital you allocate to trading — not your net worth, and not including money earmarked for anything else.
- Risk %
- The share of that capital you accept losing if the stop is hit. The convention taught here is 1–2% per trade.
- Entry price
- The price you plan to enter at. Use the trigger, not the current price, when the entry is conditional on a breakout.
- Stop-loss price
- The price at which the setup is proven wrong. This comes from the chart's structure, never from a round number or from the loss you would prefer to take.
A worked example, from a real published setup
Take a real published setup. In ChartBook 280, Alkem Laboratories was marked at ₹5,541.60 after a 7-month double bottom, with the primary entry on a daily close above ₹5,600 and the stop below ₹5,390 — the neckline retest. Assume ₹5,00,000 of trading capital and a 1% risk rule.
- 1Fix the rupee risk1% of ₹5,00,000 = ₹5,000. That is the most this trade may cost if the stop is hit.
- 2Measure the risk per shareEntry ₹5,600 minus stop ₹5,390 = ₹210 per share.
- 3Divide₹5,000 ÷ ₹210 = 23.8, so 23 shares. Always round down — rounding up breaches the risk rule you just set.
- 4Sanity-check the capital committed23 × ₹5,600 = ₹1,28,800, which is about 26% of capital tied up to risk 1% of it.
23 shares. If Alkem drops to ₹5,390 the loss is ₹4,830 — under the ₹5,000 ceiling, and known before the trade was placed rather than discovered after.
How to read the answer
- The share count is an output, not a target. If it comes back smaller than you expected, the stop is wide — that is the chart telling you the invalidation is far away, not a reason to move the stop closer.
- A position value larger than your capital means the trade needs margin. Leverage does not reduce the risk you just calculated; it changes what happens when a stop gaps through overnight.
- If the position size is so small it feels pointless, the honest conclusions are that the setup needs a tighter structural invalidation, or that this stock is too expensive for the account. Increasing the risk percent to make the number look better is the one response that guarantees trouble.
- Rupee risk should stay roughly constant across trades. If one position risks ₹5,000 and the next ₹18,000, the strategy's results will be dominated by which trades happened to be sized large — not by whether the analysis was any good.
Where the stop actually comes from
The stop is the input that matters, and it should come from structure rather than from a percentage. On a double bottom the invalidation is a close below the neckline; on an ascending triangle it is a close back under the breakout level; on a descending channel breakout it is a return inside the channel. Each pattern page on this site states its own invalidation explicitly — read the stop off that, then size the position from it. A stop chosen because it is 'about 3%' is a stop the chart never agreed to.
Frequently asked questions
Multiply your trading capital by the percentage you are willing to risk, then divide by the distance between your entry price and your stop-loss. Capital ₹5,00,000 at 1% risk is ₹5,000; if the entry is ₹5,600 and the stop ₹5,390, the risk per share is ₹210, so ₹5,000 ÷ ₹210 = 23 shares after rounding down.
The convention taught here is 1–2% per trade. At 2%, six consecutive losses cost about 12% of the account — recoverable. At 10% per trade, the same run takes roughly half of it, which is the point most people stop trading. The right number is the one that keeps you in the game through a losing streak you have not had yet.
Always down. Rounding up pushes the loss above the ceiling you just set, which defeats the purpose of calculating it. The difference of one share is never worth breaching the rule.
Because the stop is far from the entry. That is the arithmetic behaving correctly — a wide invalidation genuinely is riskier per share, so fewer shares carry the same rupee risk. The fix is a setup with a tighter structural invalidation, not a tighter stop on the same setup.
The formula does not change; the inputs do. Intraday stops are usually tighter, which produces larger positions for the same rupee risk. Positional trades on weekly charts have wider invalidations and therefore smaller positions. Both should risk the same amount of money.
They answer different questions. Sizing decides how much you lose when wrong; reward-to-risk decides whether the trade is worth taking at all. A 1:3 setup sized carelessly can still ruin an account, and a perfectly sized 1:0.5 setup still needs to be right most of the time to break even. Enter the target above to see both.
No. It performs arithmetic on numbers you supply and applies general risk-management conventions. It does not recommend any security, direction or price, and it cannot know your circumstances. It is educational.
Written By
Rohit Singh
Mr. Chartist
With 14+ years of experience in Indian financial markets, Rohit Singh (Mr. Chartist) is a SEBI Registered Research Analyst, Amazon #1 bestselling author, and the founder of Investology — a premium trading ecosystem trusted by a 1.5 Lakh+ strong community across India.
This tool performs arithmetic on figures you enter and applies general risk-management conventions. It is educational: it does not recommend any security, direction or price, and it cannot account for your circumstances. Registration granted by SEBI, membership of BASL and certification from NISM in no way guarantee performance or assure returns. Markets carry risk — read all related documents carefully before investing.