Stop Loss Calculator

The distance your budget can pay for

Position sizing normally runs the other way round: you fix the stop where the trade is wrong and solve for the size. This page holds the size still and solves for the stop instead. Both come out of the same line, so the arithmetic has to agree whichever end you start from.

Three things in that list are easy to get wrong. The budget has to be in the currency the instrument pays out in — a JPY pair settles in JPY, so a 100 USD budget is not 100 of anything until you convert it. The commission is divided by the unit count, because a fixed ticket fee eats more distance on a small position than on a large one. And the spread is subtracted from the distance, not from the budget, because you pay it on the way in regardless of where the stop sits.

What falls out is the number people usually guess at. Ask someone how wide their stop is and you will hear a rule of thumb — twenty pips, two ATR, below the last swing. None of those is connected to the account. The distance above is: it is the exact width at which losing costs what you said you could lose.

Worked example: 0.50 lots of gold on a 100.00 budget

Account 10,000 USD, risk 1%, so the budget is 100.00. The instrument is XAU/USD, which is 100 ounces to a lot with a 0.01 pip — both from the contract table lower down this page. Entry is 2,400.00, direction long, and for the first pass we leave the costs at zero.

So 0.50 lots of gold with a hundred-dollar budget is a two-dollar stop. Now put the costs back, because the broker will. A 0.30 spread on gold is 30 pips at this pip size, and a 6.00 round-turn commission spread over 50 ounces is 0.12 an ounce:

The stop moves forty-two cents, which is 42 pips, and it moves toward the entry. That is the whole cost of trading: it is not a fee on your profit, it is room taken away from the trade before it starts. Anyone who computes the distance without it and then places the stop at 2,398.00 is risking 121.00 on a 100.00 budget.

Double the size and the same budget buys half the room. This is the part worth memorising, because it answers the question that actually comes up at the screen:

Check any row by hand. Take the last one: 200 ounces moving 0.17 costs 34.00 at the stop, and adding 200 x 0.30 = 60.00 of spread plus the 6.00 ticket gives exactly 100.00. Two lots of gold on a hundred-dollar budget is therefore a seventeen-pip stop — and gold trades through seventeen pips in the time it takes to read this sentence, which is another way of saying the size does not fit the budget.

When the number is narrower than the chart

This is the case the page exists for. You run the arithmetic on one lot and it says 64 pips. The last swing low on your chart is 140 pips away, and the trade is not wrong at 64 — it is not even started. Two things can be true and only one of them is yours to change.

• The chart is right and the size is wrong. The distance is a quotient: budget divided by units. If the answer is too small, the denominator is too big. Cutting the size is the only move that keeps both the level and the budget honest.
• The size is right and the trade is wrong. If 0.50 lots is the smallest size you will take and 0.50 lots does not reach the level that disproves the idea, there is no version of this trade that fits your risk. Skip it rather than negotiate with the stop.

What you do not do is put the stop at 64 pips because that is what the money allows. A stop placed inside the noise is not a smaller risk — it is a near-certain loss at a smaller size, repeated until the account notices. The distance that comes out of this calculation is a constraint on the size, not a place to put the order.

For the other direction — you know the level and want the size that matches it — that is a different calculation and it lives on the forex position size calculator, or on the main calculator if you want the market switched to something other than FX.

One budget, 56 instruments

Every instrument below shares the same 0.01 pip size, so a pip means the same price distance on all of them. The distance your budget buys is then decided by one number only: how many units a lot contains. That is why the answers across this table differ by a factor of a hundred thousand.

Read the first row properly. One standard lot of USD/JPY is 100,000 units, so a single 0.01 pip costs 1,000 JPY and a hundred-JPY budget buys a tenth of a pip. No chart level lives there. The same hundred on gold buys a full dollar of movement, and on a one-unit contract it buys a hundred dollars of it. Traders who carry a pip habit from one instrument to the next are usually carrying the contract size by accident.

The seven JPY pairs at the top settle in JPY, so a budget in any other currency has to be converted before it goes into the distance formula — the rate field in the calculator is there for exactly that. Everything from XAU/USD down is quoted in USD. The unit step in the last column is the granularity your broker will actually accept; a distance computed to four decimals on a symbol with a 1,000-unit step is a distance you cannot place.

Per-lot pip values for each of these symbols, in several account currencies, are on the pip calculator. This page uses the contract size only to turn a budget into a distance.

Checklist before you type the stop price

• Write the budget in the currency the instrument settles in. A JPY pair pays out in JPY, and 100 USD is not 100 of it.
• Take the contract size from this symbol's row in the table, not from the pair you traded yesterday. The difference between 100 and 100,000 is the difference between a workable stop and a tenth of a pip.
• Read the spread at the moment you size, in pips, and subtract it from the distance rather than from the budget.
• Divide the commission by the unit count. A flat ticket fee takes more room from a 10-unit position than from a 100-unit one.
• Compare the answer to the level on the chart. If the arithmetic gives less room than the idea needs, the size is the thing that moves.
• Enter the stop as an order when you place the trade, at the price you computed — not as an intention.

Open the position size calculator

Questions traders ask

Whatever your budget divided by your unit count comes to — on this page's example, 50 ounces of gold on 100.00 is 200 pips before costs and 158 pips after them. There is no correct pip count that survives a change in size: the same 100.00 budget on 200 ounces is 17 pips. If your method needs a fixed number of pips, it is really fixing a size, and it should say so out loud.

Not while the size stays where it is. Widening from 158 pips to 300 pips means giving those same 50 ounces 3.00 of price instead of 1.58, and the outcome goes from 100.00 to 150.00 of stop loss plus 15.00 of spread plus 6.00 of commission — 171.00. You have not changed the trade, you have changed the budget without admitting it. Either take fewer units so the wider level fits what you risk, or accept that the entry was too early. A stop that is always hit is usually a stop placed inside the noise, and noise is not a level.

Two usual reasons, both visible above. The spread is inside the distance on this page and outside it in most platform dialogues: at 30 pips on gold that is 15.00 on a 50-ounce position. And the commission is a fixed ticket charge here, so it eats 0.12 an ounce at 50 ounces and 1.20 an ounce at 5 — the smaller the position, the bigger its bite out of the distance.

Related guides

• Forex position size calculator — the same arithmetic run the other way: fix the stop, solve for the size.
• Position size by instrument — contract size, pip size and unit step for all 131 symbols.
• Pip calculator — what one pip is worth per lot, by instrument and account currency.
• Position size after spread and commission — where costs sit inside the calculation, and why 50,000 units becomes 44,000.
• How much should you risk per trade? — where the budget number comes from in the first place.