Position sizing: risk 1% and never blow up

Size from your stop, not your conviction

Most blow-ups come from over-sizing one trade. The fix is a rule: risk the same small slice of your account on every trade — commonly 1%.

The math (it's simple)

1. Risk budget = account × risk%. On a $10,000 account at 1% that's $100.
2. Risk per share = |entry − stop|. Enter at $50 with a stop at $48 → $2/share.
3. Shares = risk budget ÷ risk per share = 100 ÷ 2 = 50 shares (a $2,500 position).

If the stop hits, you lose exactly $100 — no more. Your winners can be any size; your losers are capped.

Why it works

• A string of losers barely dents the account, so you're never forced to "make it back."
• It makes every trade comparable — your journal's R-multiples actually mean something.
• It removes emotion from sizing: the number is the number.

You'll find the Position sizer on your Dashboard — plug in your account, risk %, entry and stop, and it does the arithmetic for you.

Educational only — not financial advice.