Size every trade by risk, not gut feel — enter your capital, risk percentage, entry and stop-loss to get the exact quantity to buy.
Professional traders decide the maximum loss before entering a trade — typically 1-2% of capital — and derive the quantity from it: qty = risk amount ÷ (entry − stop). This single habit is the biggest difference between accounts that survive losing streaks and accounts that blow up. The stop-loss defines risk per share; your risk budget defines how many shares.
Small, frequent positions get eaten by charges — check the true cost per round-trip in our brokerage calculator. And remember intraday profits are taxed as business income at slab rates, unlike delivery gains. For stock selection itself, every NSE stock has a free AI analysis on VestAI stock pages.
Position size = (capital × risk per trade %) ÷ (entry price − stop-loss price). Example: ₹5 lakh capital risking 1% (₹5,000) on a trade with entry ₹1,000 and stop ₹975 (₹25 risk/share) → 200 shares. If the stop hits, you lose exactly ₹5,000 — 1% of capital, as planned.
The widely used standard is 1-2% per trade; conservative traders use 0.5%. At 1% risk, it takes 10 consecutive losing trades to draw down 10% of capital — survivable. At 10% risk, four straight losses wipe out a third of your account. Position sizing is what keeps losing streaks from becoming fatal.
It means your stop is very tight relative to your risk budget, and buying that many shares would need leverage. Either widen the stop to a technically sensible level, reduce the risk percentage, or accept the smaller unleveraged size. Leveraging to "fit" a position multiplies risk beyond your plan.
At a price that invalidates your trade thesis — below a support level, swing low or moving average, not at an arbitrary percentage. Place the stop first based on the chart, then let this calculator size the position. Sizing to the stop (not the other way around) is the core of professional risk management.
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