The Absolute Math Formula Every Prop Trader Needs for Position Sizing

Stop guessing your lot sizes! Choosing arbitrary lot sizes like 1.0 or 0.5 without accounting for stop-loss distance is the fastest way to breach prop firm limits. Always use the core formula: Position Size = (Account Capital × Risk %) ÷ (Stop Loss Distance in Pips × Pip Value). If your stop loss expands, your lot size must shrink to keep your dollar risk identical. How do you calculate your size before opening a position?