Determine optimal position size based on account balance, risk percentage, stop loss distance, and currency pair pip value.
This calculator translates a trading-risk limit into a forex position size. Enter the account balance, the percentage of that balance you are prepared to risk, the stop-loss distance in pips, and the pair's pip value for one standard lot. The calculator converts the percentage into money at risk, then divides it by the loss that one lot would incur at the stop. The common mistake is entering a pip value for the wrong lot size or account currency.
A concrete input and expected output from the current implementation.
Input
Account balance: USD 10,000 Risk: 1% Stop loss: 25 pips Pip value per standard lot: USD 10 per pip
Expected output
0.40 standard lots
The risk allowance is USD 10,000 x 1% = USD 100. One standard lot would lose 25 x USD 10 = USD 250 at the stop, so the position size is USD 100 / USD 250 = 0.40 lots.
The account balance is multiplied by the entered risk percentage. For example, 1% of a USD 10,000 balance is USD 100. This is the planned loss if price reaches the stated stop, before allowing for spread, commissions, slippage, financing, or any difference between the requested and executed stop price.
The stop distance is multiplied by the pip value for one standard lot to find the loss per standard lot. The allowed monetary risk is then divided by that figure. A result of 0.40 standard lots represents 40,000 units of the pair's base currency because a standard forex lot conventionally represents 100,000 base-currency units.
No. The risk percentage describes the intended loss at the stop, not the margin required to open the trade. Margin depends on the position's notional value, the currency pair, the applicable exchange rate, and the leverage or margin terms provided by the broker. A risk-sized position can still require more available margin than the account has.
No. Pip value depends on the pair, position denomination, lot basis, account currency, and potentially the relevant conversion rate. Use a pip value expressed in the account currency for one standard lot. Recalculate or obtain a current value when changing pairs or when currency conversion affects the value; otherwise the resulting lot size can be wrong.
The example and behavioral notes were checked against the browser implementation. Standards and primary references below define the relevant format, formula, or platform behavior.
Calculate gross, operating, and net profit margins from cost and revenue with breakeven analysis.
Convert between annual salary and hourly rate with adjustments for work hours, overtime, and benefits.
Calculate sales tax amounts, tax-inclusive and tax-exclusive prices for any tax rate or jurisdiction.
Calculate return on investment from initial cost and final value with annualized ROI and comparison tables.
Convert between markup and margin percentages, calculate selling price, and compare pricing strategies.
Convert numeric amounts to written words for invoices, checks, and legal documents in multiple currencies.