The lesson on YouTube
Watch. Then work through the idea.
Watch the English lesson first, then use the worked example and quiz below to check the idea. The article is a companion, not a transcript.
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What is actually happening?
Estimated risk increases with the distance from entry to protective stop, the cash value of a price move, and the number of units. Costs and adverse execution add to that estimate. Account leverage or margin is not the same thing as a loss budget.
Guided example · Cash-risk arithmetic · assumed USD
Turn a loss budget into units
Build the position estimate one component at a time.
Restart & example assumptions
Authored synthetic observations, shown in sequence. Every comparison uses only the revealed data. This is a worked learning example, not live prices, broker execution or a profitability backtest. Follow the article’s exact definitions; measurements and pattern names alone do not authorize a trade.
For charts: tap a candle or swing to inspect it; drag horizontally to browse; wheel or +/− to zoom; arrow keys to inspect; Home to restore the step view.
Make the conditions explicit.
Use the correct contract specification and account currency. A stock share, a futures contract and a forex lot do not have interchangeable point values.
Define a cash budget, entry, stop, cash-per-point-per-unit and unit increment before placing an order. Calculate a rounded-down quantity.
If the smallest tradable unit exceeds the budget, skip the trade or use a genuinely smaller instrument. Do not tighten the stop merely to fit the size.
The quoted rules are illustrative research specifications. Parameters are not recommendations and have not been presented as profitable backtest results.
What can this cost?
Gaps, insufficient liquidity and stop-order mechanics can produce a loss larger than the estimate. This calculator is not a guarantee, margin check or suitability assessment.
How the idea can fail.
A $100 budget does not justify buying a contract with $150 estimated risk. Averaging into a losing position without recalculating aggregate exposure breaks the original budget.
Practical habit
Separate the amount you plan to risk from the amount you must post as margin. Check both with your broker.
Go one level deeper
Test sensitivity to worse slippage and correlated positions. Several independent-looking trades may share the same underlying exposure.
Check your understanding
What if one minimum unit exceeds your chosen risk budget?
Further reading & boundaries
These examples are original educational exercises. General background: CME Group: position sizing; Fidelity: technical analysis. Neither endorses these example rules. No hypothetical result establishes future profitability.
Editorial revision: 13 October 2026 · Synthetic data · Educational use