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Quiz: Size 5 hypothetical trades
Calculate position size live.
8 min · Beginner
What you'll learn
- Calculate share and contract size quickly and correctly under time pressure
- Apply slippage buffers and buying power caps to the raw formula
- Recognize when the correct size is zero and the trade should be skipped
Key takeaways
- Run the same five steps every time: dollar risk, risk per share, shares, buying power, options check.
- Always round down; rounding up means risking more than 1R.
- A buying power cap lowers your risk, which is fine; never change the stop to fit the size.
- If one contract's premium at risk exceeds your dollar risk, the correct size is zero.
Glossary
- Round down rule — Always rounding share or contract counts down so risk never exceeds 1R.
- Slippage buffer — Extra cents added to risk per share on thin or fast stocks to account for worse-than-planned stop fills.
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