How much to buy — and how likely that stop is to be hit anyway
Sizing works without live data. The price feed fills in a starting entry and stop, and powers the probabilities below.
Changes margin required, not position size.
This is the most common confusion in position sizing. Your size comes from the distance to your stop and the amount you are willing to lose — nothing else. Leverage only changes how much margin is locked up to hold that same size. Doubling leverage with the stop unchanged does not double your risk; it halves the margin posted and leaves the loss at stop identical.
Where leverage genuinely bites is liquidation. A position sized by risk can still be liquidated before its stop is reached if the leverage is high enough that the liquidation price sits inside the stop distance — at which point the stop never gets the chance to work. Fees and slippage are also excluded here and both make real losses slightly larger than the figure above.
Sizing by feel goes wrong in a specific way: with a tight stop the position ends up far too large, and with a wide one far too small. Reversing the order fixes it. Decide first what a losing trade may cost — your account multiplied by a risk percentage — then divide that by the distance from entry to stop. The result is your quantity, and it automatically shrinks as the stop widens so the loss stays the same either way.
What that formula does not answer is how often the stop gets hit, and that is half the question. A 3% stop is noise on a volatile altcoin and a real signal on a quiet large cap. So this page also samples the coin's measured volatility to estimate how likely ordinary movement is to touch your stop within 7, 30 and 90 days, with no directional view involved. A stop that normal noise reaches most of the time is not protecting anything.
The last piece is the reward ratio. If a trade risks one unit to make two, it needs to be right only a third of the time to break even — the threshold is exactly 1/(R+1). Seeing that number next to the size makes it obvious that improving the ratio moves the bar much further than trying to raise a win rate.
⚠️ Not investment advice. Fees, slippage and funding are excluded, and a position sized this way can still be liquidated before its stop if leverage is high enough. All trading decisions and risks are your own.
Divide the amount you are willing to lose — your account multiplied by your risk percentage — by the distance from entry to stop. That gives the quantity, and because the distance is in the denominator, a wider stop automatically produces a smaller position and the loss at stop stays the same either way.
No, and this is the most common misconception. Size comes from the stop distance and the loss you accept. Leverage only changes how much margin is locked up to hold that same position. Doubling leverage with an unchanged stop halves the margin posted and leaves the loss at stop identical.
Common practice is 0.5% to 2% of the account per trade, and the reason is arithmetic rather than taste: at 2% risk a run of ten losses costs about a fifth of the account, while at 10% the same run is close to fatal. There is no correct figure, but it should be a number a losing streak can survive.
Because sizing only fixes what a loss costs, not how often it happens. The same 3% stop is routine noise on a volatile altcoin and a meaningful level on a quiet large cap. The figure comes from sampling that coin’s measured volatility with no directional view, so it estimates how often ordinary movement alone would touch the level.
One R is the amount risked, so a target three times the stop distance away is 3R. The win rate needed just to break even follows only from that ratio and equals 1/(R+1) — 50% at 1R, 33% at 2R, 25% at 3R. Improving the ratio lowers the bar far more dependably than trying to be right more often.
Yes, if leverage is high enough that the liquidation price falls inside the stop distance, in which case the stop never gets a chance to execute. Sizing by risk does not prevent that on its own — check the liquidation price separately for the leverage you intend to use.