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Glossary

Position sizing(Position sizing)

Deriving the number of lots/contracts from the cash risk accepted per trade and the stop distance. The core of risk management.

Also written as: pozisyon büyüklüğü · pozisyon boyutu · position size

Formula: lots = (account × risk %) / (stop distance × pip/tick value). A $10,000 account, 1% risk, 20-pip stop, $10/pip → 0.5 lot.

Common mistake: picking the lot size first and then fitting the stop to it. It works the other way around. Tools → the Position Sizing calculator does this for you.

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