M6 · L2Risk Management
Position Sizing Calculator
You calculate lot size before every single trade. This is how professionals never blow accounts.
What This Means
Position sizing is how you make sure you never risk more than 1% of your account. The formula is simple: Account × 1% ÷ (stop loss in pips × pip value) = lot size. For gold (XAUUSD), 1 standard lot = $10 per pip. 1 mini lot (0.1) = $1 per pip. 1 micro lot (0.01) = $0.10 per pip.
Visual
The Rule
Lot size = (Account × 0.01) ÷ (SL pips × pip value)
For XAUUSD: pip value with 0.01 lot = $0.10 per pip.
COPY THIS
Do these steps exactly1
Write down: Account balance = $___
2
Calculate: Max risk = Account × 0.01 (1%)
3
Write down: Stop loss = ___ pips
4
For XAUUSD on a micro account (0.01 lot = $0.10/pip):
Lot size = Max risk ÷ (SL pips × $0.10)
5
Example: $1,000 account, 10 pip SL:
Max risk = $10. Lot size = $10 ÷ (10 × $0.10) = $10 ÷ $1 = 0.10 lots
6
Before every trade, run this calculation. Never skip it.
Common Mistake
Never round up your lot size. Always round DOWN. It's better to risk $9.80 than $10.20.