How to size a crypto position with risk per trade

Published 9 November 2026 · by Hunt4Coin

Position sizing is deciding how much of a coin to buy so that, if the trade hits your stop-loss, you lose only a fixed, small share of your account, usually by working it out as account size × risk per trade ÷ distance to the stop.

Most beginners decide the size of a trade by feel ("put in $500") and the stop-loss afterwards. Position sizing turns that around: you first decide where the idea is wrong (the stop), then how much of the account you accept to lose if it is wrong (the risk), and the size follows from those two numbers. It doesn't make a trade more likely to win. What it does is keep each loss the same, known size, so a run of losses, which every strategy has, doesn't empty the account.

The formula

position = account × risk per trade ÷ stop-loss distance

• Account: the money you trade with, not your total savings.
• Risk per trade: the share of the account you accept to lose if the stop is hit. Many traders use 0.5% to 2%.
• Stop-loss distance: how far below your entry the stop is, in percent of the entry price.

The result is the amount to put into the trade. If the stop is hit, the loss is roughly the risk you chose, plus fees.

Worked examples

Two things stand out. First, the wider the stop, the smaller the position: a coin that needs a 5% stop gets less money than one that needs 2%, and the loss stays the same. Second, a very tight stop asks for a huge position, in the third row twice the whole account. That is why a sensible calculator also has a cap.

Add a maximum position size

A cap ("never more than 25% of the account in one trade") protects you from the tight-stop problem, and from coins that can gap through a stop, where the real loss is bigger than planned. With $1,000, 1% risk and a 2% stop the formula says $500; with a 25% cap the position becomes $250, so a stop-out loses about $5 instead of $10. The cap only ever makes the trade smaller.

Don't forget fees and slippage

Fees are paid on the way in and on the way out. At 0.1% per side, a $500 position pays about $0.50 to enter and about $0.49 to exit at a 2% stop, so the "$10 loss" is really about $11. On short timeframes, where stops are tight and trades are frequent, fees can be a large part of every loss. Market orders also fill a little worse than the last price (slippage), and a fast drop can skip past the stop entirely. A simple way to allow for this is to plan with a slightly larger stop distance, or a slightly lower risk per trade, than the chart suggests. The worked fee example shows on real Bitcoin candles how much fees change a result.

Step by step

1. Pick the stop first, from the chart. Put it where the idea is clearly wrong: below a recent swing low, below the 200 EMA, or at a Supertrend or ATR-based level. Don't move it to make the position bigger.
2. Measure the distance in percent. Entry $100, stop $96 → 4%.
3. Choose your risk per trade and keep it the same for a while, so results are comparable.
4. Work out the size with the formula, then apply your cap.
5. Check the fee for your exchange (exchange fee table) and round the size down if needed.
6. Write it down. A journal of entry, stop, size and result shows whether you really stuck to the plan.

How it changes a losing streak

Ten losses in a row happen even to rules with a decent win rate. Risking 1% each time, ten losses take the account down by about 9.6% (each loss is 1% of what is left). Risking 10% each time, the same streak takes it down by about 65%, and you would need almost a 190% gain to get back to where you started. The trades are the same; only the size differs.

Common mistakes

• Sizing by conviction. Putting more into trades that "feel" certain usually means the biggest losses come from the most confident ideas.
• Moving the stop after sizing. Widening the stop keeps the position but raises the risk you actually take.
• Using the total portfolio instead of the trading account. If only part of your money is for trading, size from that part.
• Ignoring leverage. With leverage the position can be bigger than the account, and liquidation can come before your stop. Position sizing doesn't make leverage safe.
• Raising the risk after losses to "win it back". That turns a normal drawdown into a deep one. A daily loss limit helps here.
• Forgetting correlation. Five open trades in coins that all move with Bitcoin behave a lot like one big trade.

Try it free

1. In paper trading, open the Risk guard settings and enter your account size, risk per trade, usual stop-loss, largest position and a daily loss limit. The defaults are a $1,000 account, 1% risk, a 2% stop, a 25% largest position and a 3% daily loss limit. How the calculator works.
2. On a signal, press Size: the calculator works out the amount from those settings, and Paper trade pre-fills it. Fees of 0.1% are charged on the buy and on the sell.
3. Turn on the daily loss limit: once your paper trades lose that much in a day, the Signals list is hidden until tomorrow (you can still choose to show it).
4. To see how a position size in percent of equity changes a strategy's results and drawdown, set Position size % in the backtester and compare, with fees included. Find setups with the crypto screener and place stops on the free candle charts.

More guides: how to backtest with fees, how to read RSI and MACD, how to use a crypto screener, the 200 EMA and Supertrend.

Information only, not financial advice. Position sizing limits how much a single loss costs; it doesn't make any trade profitable.