Position Size
Calculate a share quantity that fits your planned risk, available cash and allocation cap.
How to use it Enter your portfolio value, entry and planned exit. Set a risk budget, allocation cap and cash available. The smallest of those three limits determines the quantity.
Calculated position
Constrained by: risk budget.
- Capital required, including costs
- £2,455.00
- Planned loss at exit
- £500.00
- Planned loss / portfolio
- 1%
- Capital / portfolio
- 4.91%
- Cash remaining
- £2,545.00
A price gap or thin liquidity can make the loss larger.
Why it matters
Position sizing matters. Get it wrong and one bad trade can do serious damage.
With a £50,000 portfolio, a 1% risk budget, 50p entry and 40p exit, the risk allowance is £500. Allowing £5 to buy and £5 to sell leaves room for 4,900 shares: £2,455 invested and a £500 planned loss at that exit.
How it's calculated
1. (risk budget − purchase costs − exit costs) ÷ (entry − exit)
2. (allocation cap − purchase costs) ÷ entry
3. (available cash − purchase costs) ÷ entry
Prices are converted from pence to pounds before sizing. Purchase costs count towards the allocation and cash limits; both purchase and exit costs count towards the risk budget. Whole shares are rounded down. No transaction costs are charged in the illustration when zero shares can be bought.
Assumptions & limitations
This is a planned-loss calculation, not a maximum-loss guarantee or a recommended allocation. Exit prices can be missed and liquidity can disappear. A holding can lose its entire value. The allocation percentage uses purchase cost, including entered purchase costs, divided by the portfolio value supplied. No borrowing or live prices are modelled.