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100 shares of BAC stock. If 100 shares move 10 points against you you’re down $1000 (your 1%)
risk: $1000
stop: 10 points away
1000/10=100
(risk in dollars/stop points away)=number of shares in stock
Futures you need to know the tick amount. Every futures instrument has a different tick amount.
Example:
ES is $12.50/tick or $50 a point
risk: $1000
stop: 6 points away
6 x 50 = 300 this is the risk per contract for a stop loss 6 points away
1000/300=3.33 you can’t do futures in partial contracts so you trade 3 contracts.
If 3 contracts ($150/point) move 6 points against you and get stopped out, you are down $900
CL is $10 per tick
risk: $1000
stop: $0.25 away or 25 ticks away or $250 per contract
You are able to trade 4 contracts of CL under your conditions
Are you looking for how to figure this out or the position size calculator itself?
I checked the calculator you found. It works fine for stocks. Below are the inputs and outputs and how you enter the inputs based on your criteria in your open.
INPUTS:
Account value: 100000
Percentage of account value willing to risk: 1
Entry price: 30
Initial stop: 20
Keep in mind if you short at 30 with a stop at 40 this will also compute the number of shares. It will show as -100 instead of a positive number.
You hit compute
OUTPUTS:
Max # of shares: this is the number I gave you. 100 shares of BAC
Position size: This is the total dollar value of your position. If you bought 100 shares at $30 (30 x 100) you get $3000.
$ Risked/share: this input takes your entry price - stop (30-20) and you see $10 here
% Risked/pos: This is the amount risked of this position. This output comes out to 33.33%. This is NOT the risk of your entire account of $100,000. This is the risk of ONLY THIS POSITION. Your total position value is $3000 and you’re willing to risk $1000 of that. That’s why the input comes out this way.
$ Risked/pos: This tells you what dollar value you are risking. Since you entered 1 in the input section and you entered your account value as 100000 it gives you the input of $1000.
Out of all the outputs above, you are really looking to find out how many shares you can put on. The
other outputs are extra information. The first output is the one you are looking for based on your question in your open.
Are you trying to open a strategy or do you already have a strategy? I can possibly give you some more ideas. I would need to know what kind of trader you are (day/swing). Any other information you can provide. What I don’t want is the secret sauce to your strategy. Do NOT put in the exact methods of how you take trades and how you exit. I’m looking for more general things. Do you scale in/out? What do you trade (stocks/options/futures). How do you manage risk?
Sorry for the late response. I’ve been sick the last few days and today was my first day back. I think I know what you’re looking for. Get ready to get your hands dirty and learn Excel. I’ll explain what I have but I built it myself in Excel. This may help you.
I have one main table with every instrument I trade. I also have minor tables for each individual instrument. These are designed to work together so every minor table is linked to the major one. I also have a live data feed coming into Excel. I doubt you need this for what you’re looking to do but I need this for certain reasons. For the minor tables, I have different scale in levels and different stop levels. I’m able to put in how many contracts at each price for entry and each price for stop. This gives me the average entry and average stops. I have more data in these tables and I’ll get to that. Once I enter, the entire position shows up in my major table. What I can immediately see is the initial risk and contract size. In the main table, I also have in ticks what my actual stop is. I also use different metrics to determine what my max stop should be. This compares the two to make sure everything is inline. I’m also immediately able to see what price 1 R is and 2 and 3 R and so on. I have other metrics that aren’t useful here but the table immediately calculates them for me. These metrics update every night and the table updates automatically. As contracts start coming off, I now have locked in money in the realized P/L column. This now shows me what’s really at risk left. When I move stops, this also reflects how much risk is left on the table. Every time something changes (example a stop moved), I can see at what price 1 R would be for example and other metrics like my theoretical entry price and just a bunch of other stuff. This table also shows my win rate and will signal if I try to take a trade that doesn’t work with my win rate. This metric is PCP or profitability check planned. If I have a win rate of 50% (not my real win rate), I can’t take a trade that I risk 3 to only win 1. If I tried, this would warn me before even putting the trade on. There’s much more to this table but I don’t think you’re looking for much more.
I’ll give you an example. ES is trading at 2839 right now. I could enter in the ES table that I want to go long at 2839 for 1 contract and 2838 for 2 contracts and 2837 for 2 contracts. I could also enter my stops for example as 2830 for 3 contracts, 2833 for 1 contract and 2835 for 1 contract.
I immediately see that I’m trying to go long ES 5 contracts at an average price of 2837.8 and my average stop is 2831.6. The more important things is I immediately see the risk on the table is $1550. I also see the price of ES if nothing else changes to hit 1 R or 2 R for example. Meaning what price would ES be at to be up $1550 or be up $3100.
Now let’s say hypothetically this trade started to work. Say I decided to scale out of 1 contract as ES went up and realized $500. My risk is now $1050. And assume I adjusted my stops on the other 4 contracts to 2839. I’ve now locked in a guaranteed profit of $740. The way I built this Excel sheet, it is interactive enough to let me know ahead of time how moving these stops reflects on my position. Say you decided to take one more contract off with a $700 realized profit. If stops don’t move from 2839, you have a realized $1200 and a guaranteed profit of $1380 even if you get stopped out. Remember your trade is probably up more at this point but this is what you are guaranteed. Now you have 3 contracts left. Assume your next move is to move stops to 2844 and 2843 and 2842.25. What you’ve just done is locked in profits of $1992.50 even if you get stopped out. And every change you make, the table gives me metrics I want to see that update with every change. For example, you locked in more than 1 R at this point but not quite 2 R. With the remaining 3 contracts, Excel will show me what price I have to hit to achieve 2 R or whatever other metric you want to see with every change. In addition to R, I see it in percentages also. I have more than one account so I have every account with balances. I see the percentage change of the account I’m trading and the percentage change of all accounts combined. I also have a max risk dollar amount and percentage amount. I have a column that gives me the trade on and what percentage that represents of my max percentage allowable. For example, we used ES and had an initial risk of $1550. Say your max allowable per day risk percentage is X, this column will show me what percentage $1550 is of X as a percent so I know how much I’m risking. It also tells me how much more I have left to trade with if this trade is on. It does this in percentage and in dollars. So I immediately know that if this trade is on, I have this many dollars I can put on as risk on another trade or series of trades. And as these are daily allowable risk amounts for me, these adjust as I lock in profits. So when I locked in $1992.50 in the ES example, my dollar amount I can risk per day went up by this but will reset the next day because the stop moved guaranteed this amount. I have a bunch more stuff built in but it would take me just as long to even explain what those even do. The main thing is you can build whatever calculator you want. If you want something fancy like this, you’re going to have to build it or find someone that sells something like what you’re looking for.
Was that what you’re looking for? Or partially what you’re looking for? Or maybe overkill?
