Using a share size calculator

Its hard, if not impossible to calculate position sizes and stop distances accurately in your head. I can’t do it. So what I created was a share size calculator that I input my entry, my stop, and how much I want to risk and it tells me how many shares I need to trade.

For example, lets say you wanted to get long a stock at $5 with a stop at $4.50 and only wanted to risk $100. Well after putting that into the calculator it tells me I need to trade 200 shares. Now that was a simple example, but with this calculator you can really get to the point with what ever entry and stop you want while keeping your risk precise and defined how you want it.

What a lot of traders do is not pay attention to their risk. They put a position on and then close it out when it hurts to much. That is the road to ruin.

Straight from the beginning you need to have clear and defined parameters so that you just are executing a machine and not doing ‘what ever you feel like’. That will allow you to really dial in your statistics and see where you are at in your trading. What do you need to work on? Is it a wider stop distance or a shorter profit target distance?

By starting out with precise stop distances and risks, you are setting yourself up for success from the beginning.

To download my share size calculator click here!