Risk and money
How do I calculate position size?
Divide the money you are willing to lose by the size of your stop in pips. That gives you how much each pip should be worth, which tells you the lot size.
Step 1: pick your risk in dollars. Step 2: measure your stop in pips. Step 3: risk divided by stop equals dollars per pip. Step 4: turn dollars per pip into lots.
On EUR/USD, $10 per pip is 1 standard lot, $1 per pip is 1 mini lot and $0.10 per pip is 1 micro lot.
The position size calculator does this for any pair, so you can check your math before every trade.
$5,000 account, 1% risk, 25 pip stop
- 1Risk: 1% of $5,000 = $50.
- 2Stop: 25 pips.
- 3$50 / 25 pips = $2 per pip.
- 4$2 per pip on EUR/USD = 0.20 lots (2 mini lots).
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This is taught in Grade 4: Risk Camp.
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Reviewed 2026-10-04. Education only, not financial advice. Trading involves risk of loss.