Calculating your position size (shares) is straightforward once you know the Position Size formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Position Size Calculator.
What is Position Size?
The Position Size calculation tells you your position size (shares) from a few simple inputs. The figure you are solving for here is the position size (shares).
The Position Size formula
The core formula is:
Position size (shares) = (Account size × Risk per trade ÷ 100) ÷ (Entry price - Stop-loss price)Here is what each input means:
- Account size — a money amount. Example: ₹10,00,000.
- Risk per trade — a percentage, such as an annual rate. Example: 1%.
- Entry price — a money amount. Example: ₹100.
- Stop-loss price — a money amount. Example: ₹95.
How to calculate it step by step
- Write down the account size (for example, ₹10,00,000).
- Write down the risk per trade (for example, 1%).
- Write down the entry price (for example, ₹100).
- Write down the stop-loss price (for example, ₹95).
- Apply the formula above to get your position size (shares).
- Double-check the result with the Position Size Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Account size | ₹10,00,000 |
| Risk per trade | 1% |
| Entry price | ₹100 |
| Stop-loss price | ₹95 |
| Position size (shares) | 2,000 |
| Amount at risk | ₹10,000 |
With account size of ₹10,00,000, risk per trade of 1%, entry price of ₹100 and stop-loss price of ₹95, the position size (shares) works out to 2,000.
Example 2
With account size of ₹20,00,000, risk per trade of 1%, entry price of ₹100 and stop-loss price of ₹95, the position size (shares) works out to 4,000.
| Result | Value |
|---|---|
| Position size (shares) | 4,000 |
| Amount at risk | ₹20,000 |
Example 3
With account size of ₹5,00,000, risk per trade of 1%, entry price of ₹100 and stop-loss price of ₹95, the position size (shares) works out to 1,000.
| Result | Value |
|---|---|
| Position size (shares) | 1,000 |
| Amount at risk | ₹5,000 |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
- Annual rates must be converted to the period you are calculating for (for example, divide an annual rate by 12 for a monthly figure).
Prefer not to do the maths by hand? — the Position Size Calculator does it instantly, for free, with the formula and a worked example built in.
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