🎯 Position Sizer

Tells you exactly how much to put into a single individual stock trade based on the most-respected risk rule in trading: never risk more than 1–2% of your total portfolio on any single position's worst-case outcome.

Total portfolio value$50,000
Max % of portfolio you'll risk1.5%
Most pros use 1–2%. Penny stock traders should be on the lower end.
Entry price (price you'd buy at)$10.00
Stop-loss price (where you'd sell to cut losses)$8.00
The price below entry where you'll bail. Common: 15–25% below entry.

What you should do

Risk per share
—
Loss if stop hits
Max # shares
—
Position size
Total $ in position
—
% of portfolio: —
📌 What this means

How this calculates

Step 1: Max $ you're willing to lose on this trade = portfolio × risk%

Step 2: Risk per share = entry price − stop-loss price

Step 3: Max shares = max $ to lose ÷ risk per share

Step 4: Total invested = max shares × entry price (could be way more than the max loss — that's fine; you're only losing the difference between entry and stop)

⚠️ Use this for the active bucket only This is a tool for individual stock positions. Your long-term ETF holdings don't need position sizing — they're already diversified internally. The 2% rule applies to the size of any one stock, not to your aggregate ETF holdings.

Example interpretation

Portfolio = $50,000. Risk = 1.5% ($750). Entry = $10. Stop = $8 (–20%). Risk/share = $2. Max shares = 750 ÷ 2 = 375 shares. Total invested = 375 × $10 = $3,750. If the stop hits, you lose $750 (1.5% of portfolio). If the stock 2x's, you make ~$3,750. The asymmetry is the point.