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Stocks and trading

Position size calculator

Work out how many shares a trade involves if you decide in advance how much you can afford to lose.

% of capital

The loss you decide in advance you can take if the stop-loss is hit. It is your own figure.

Direction
per share
per share

Below the entry price for a long trade.

Brokerage and taxes

Counts STT, brokerage, exchange fees, GST and stamp duty from the broker’s published plan.

Broker plan

Charges use the rates this broker publishes for an ordinary account, on NSE. Your own plan may differ.

Kind of trade

With ₹5,00,000 and a risk of 1%, a stop-loss ₹10.00 from the entry fits 500 shares. The loss if the stop fills is ₹5,000. This is arithmetic, not a suggestion to trade.

Quantity
500 sharesWhole shares, rounded down so the loss at the stop stays within your limit.
Rupees at risk
₹5,000Lost if the stop-loss fills at your stop price, before charges.
Position value
₹2,50,00050% of your capital

The working

Risk budgetCapital x risk per trade
₹5,000
Risk per shareDistance from entry to stop-loss
₹10.00
Budget left unusedRounding down leaves a little
₹0.00
Shares your capital alone could buy
1,000
Charges if stopped outEntering and leaving the trade
₹566.36
Realistic loss at the stop1.11% of your capital
₹5,566.36

Charges worked out for delivery trading on NSE with Zerodha’s published plan.

What this assumes

  • The stop-loss fills at exactly the price you entered. In a fast market it can fill worse, and the loss is then larger.
  • Risk is measured on the capital you entered, not on money borrowed.
  • The quantity is only the arithmetic of your limit. It does not say whether the trade is a good one.
  • This describes the figures you entered. It does not predict what comes next.

What next

  • Risk-reward

    Compare how far a stop-loss and a target are from your entry, and the win rate that breaks even.

  • Brokerage

    See every charge on a trade, from brokerage to taxes, and what you actually keep.

  • Margin

    See the exposure, the leverage and the price move that would use up your margin on a leveraged position.

  • Average price

    Find the weighted average price of several buys, and what it takes to reach a target average.

How it works

Position sizing starts from the loss you can accept, not from the number of shares you want. You decide what share of your capital you would let a single trade lose, find how far the entry price is from the stop-loss, and divide.

Quantity = (Capital x Risk %) / |Entry - Stop-loss|, rounded down to a whole share

A worked example

With ₹5,00,000 of capital and a risk of 1 percent, the budget is ₹5,000. An entry at 500 and a stop-loss at 490 is 10 a share, so 500 shares fit. If the stop-loss fills at 490, the loss is ₹5,000 (1 percent of capital). The position is worth ₹2,50,000, which is 50% of the capital. This is arithmetic on the figures you enter, not a suggestion to take the trade.

When charges are included, the page adds the cost of entering and leaving the trade at the stop-loss price, using the broker plan you pick. That is why the realistic loss is a little more than the rupees at risk.

What it leaves out

  • Whether the entry, the stop-loss or the trade itself is sensible. The page only sizes what you decide.
  • Slippage: a stop-loss order can fill at a worse price than the one you set, especially in a fast market or after a gap.
  • Borrowed money. Margin and leverage are on a separate page.
  • Tax on profits or losses.

Questions people ask

What is a stop-loss?

It is an order you place to leave a position if the price moves against you to a level you chose. Here it only sets the distance used in the arithmetic: the gap between the entry and the stop-loss is the loss on each share if the stop fills at that price.

Why is the quantity rounded down?

Shares trade in whole units, and rounding up would make the loss at the stop larger than the limit you set. Rounding down keeps it at or under the limit, and the page shows how much of the budget is left unused.

What percent of capital is usually risked per trade?

There is no standard figure this page can give you. It is your own choice and depends on your capital, how many trades you have open at once and how much of a loss you could absorb. Try a few figures to see how the quantity changes.

Why is the realistic loss more than the rupees at risk?

Rupees at risk is only the price difference times the quantity. Brokerage, STT, exchange fees, GST and stamp duty are charged on top, win or lose, so the real loss when the stop fills is larger by that amount.

Why does it warn that the position is bigger than my capital?

A tight stop-loss lets a small risk limit buy a lot of shares. If the position costs more than the money you have, paying for it would need borrowing or margin, which brings its own risks. The page shows how many shares your capital alone could pay for.

Where the numbers come from