How the lot size is calculated
Start from the amount you are willing to lose if the stop is hit. Divide it by what one full lot loses at that stop: the stop distance in pips or points, times the value of one pip or point for 1.00 lot, converted into your account currency, plus the commission if your account pays one.
lot size = risk amount ÷ (stop × value per pip or point for 1 lot + commission per lot)
Hypothetical example, for illustration only. On a $100,000 account, 1% risk is $1,000. On EUR/USD one pip is worth $10 for 1.00 lot, so a 23-pip stop costs $230 per lot and the exact size is 4.3478 lots. Rounded down to the 0.01 step, that is 4.34 lots, for a real risk of $998.20. These are the numbers the calculator above opens with.
Why the real risk differs from your target
Platforms only accept sizes in steps, usually 0.01 lot, with a minimum lot below which you cannot trade. The calculator always rounds down, so the real risk stays at or under your target, and it shows what the next step up would cost. When the minimum lot alone risks more than your target, which happens with wide stops on small accounts, it says so plainly instead of rounding up: the choice is then a tighter stop, a larger risk or no trade.
Pip and point values by instrument
The value of a pip or a point for 1.00 lot comes from the contract size, and contract sizes are not the same everywhere. The calculator starts from common defaults that you can edit:
| Instrument | 1.00 lot | Default value for 1.00 lot |
|---|---|---|
| Forex pairs | 100,000 units | 10 units of the quote currency per pip (1,000 yen on yen pairs) |
| XAU/USD (gold) | 100 oz | $10 per pip of $0.10, $1 per point of $0.01 |
| US30, NAS100 | 1 x index | $1 per index point |
| GER40 | 1 x index | €1 per index point |
| WTI crude oil | 1,000 barrels | $10 per pip of $0.01 |
| BTC/USD | 1 BTC | $1 per $1 price move |
Before trading, open your platform's contract specification for the symbol and compare. If your firm's US30 contract is worth $10 a point, a size calculated on $1 a point would be ten times too large.
Lot size inside a daily loss limit
A prop firm account adds a second question: what does this trade do to today's limit? The calculator divides the room left under today's limit (the limit minus what you already lost today) by the real risk of one trade, and rounds down: that is the number of full losses in a row you can take at this size before the limit. If you enter a max drawdown and your current balance, it uses whichever room is tighter. For the exact breach level under your firm's own rule, which depends on whether the day starts from your balance, your equity or the higher of the two, open the same account in the Daily Loss Calculator. The wider picture on sizing is in Lot Sizing for Prop Firm Accounts.
Exchange rates
When an instrument is booked in a different currency from your account, for example a GBP account trading US30, the pip or point value is converted with the euro foreign exchange reference rates published each working day by the European Central Bank. Your platform converts at live prices, so the result can differ slightly: treat it as an estimate.