Maximum Position Calculator

How to use this tool

1. Enter the current balance and maximum dollar risk.
2. Measure the stop distance in the instrument’s correct unit.
3. Enter the dollar value for one unit of movement per quantity.
4. Enter the notional price represented by one quantity.
5. Enter the applicable leverage and a margin safety buffer.
6. Use the smaller risk-based or leverage-based quantity, then apply platform increments and other open exposure.

See the calculation in context

With $250 risk, a 25-unit stop and $10 per unit, risk capacity is 1 quantity. Even if leverage allows more exposure, the conservative maximum remains 1.

Calculation method

Risk-limited quantity = dollar risk ÷ (stop units × dollar value per unit). Leverage-limited quantity = buffered balance × leverage ÷ price per quantity. Conservative maximum is the smaller value.

Common mistakes

1. Using leverage to justify greater price risk
2. Entering contract price instead of notional value represented by quantity
3. Ignoring margin used by other positions
4. Omitting a safety buffer
5. Assuming leverage and margin rules never change

Questions and answers