Why use a Position Size Calculator?
The #1 reason traders fail is poor risk management. By calculating your position size before you take a trade, you ensure that even if you hit your stop loss, you only lose a fixed percentage of your account (e.g., 1%).
The Formula Used
Shares to Buy = (Account Balance * Risk %) / (Entry Price - Stop Loss)
This ensures your total dollar risk is always constant, regardless of the stock price.