Risk Management

Position sizing without spreadsheets

Published: 18/08/2026

The right position size is whatever makes your stop-loss equal to your intended risk. That's the whole formula. Everything else is just arithmetic.

8 min read

The formula

Position size = (Account × Risk%) ÷ (Stop distance in pips × pip value).

A worked example

£10,000 account, 1% risk = £100. Stop of 25 pips on EUR/USD at roughly £8 per pip per standard lot = £100 ÷ (25 × £8) = 0.5 lots.

Do it before you enter

Never open a trade and then work out what your stop should be so the loss feels bearable. Set the stop first, size the trade to match.

Educational content. Daily Trading Platform provides decision-support and education. Nothing here is financial advice or a trading recommendation. Trading FX carries significant risk of loss.

Related guides

Understanding risk managementWhy protecting capital matters more than making money — position sizing, stops, risk-reward and the habits that keep you in the game.
Why stop placement mattersStop placement is a structural decision, not a comfort decision. Where the stop sits matters far more than how tight it is.
Planning for drawdownLosing streaks are inevitable — how to expect them, cap them, and recover gradually instead of blowing up.

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