Objective-based risk sizing

MarketMates Position Sizing Calculator

Estimate your 1R dollar risk, position size, expected return, expectancy, and likely drawdown from a system’s objectives. Useful for finding the trade size that fits the goal without quietly inviting ruin to dinner.

1R risk amount $1,000 1.00% of $100,000
+100.0%expected return
+1.00Rexpectancy
$1,000expectancy / trade
0.0%p95 max drawdown

Readout

This setup has positive expectancy. Now check whether the drawdown is survivable.

Suggested workflow

Change risk per trade until expected return and drawdown both fit your objectives.

Example equity curve

Monte Carlo drawdown distribution

How to use it

  1. Enter your capital, trade sample size, win rate, and risk/reward.
  2. Adjust risk per trade until the expected return is close to your objective.
  3. Check the estimated drawdown. If it is too high, reduce risk per trade. Annoying, yes. Usually wise.
  4. Your 1R risk amount is the dollar amount to use when calculating live trade size from stop distance.

Position sizing FAQs

These answers are deliberately plain-English. Position sizing is hard enough without dressing it up as wizardry.

What does 1R mean in trading?

1R is the amount you plan to risk on a trade. If your planned loss at the stop is $500, then 1R equals $500. Measuring trades in R keeps position sizing focused on risk rather than emotion.

How should I use this calculator?

Start with your account size, win rate, risk/reward ratio, and trade sample. Then adjust risk per trade until the expected return and estimated drawdown both look survivable.

Does this predict future returns?

No. It is an educational model. It uses simplified assumptions to show how risk per trade, expectancy, and drawdown can interact over a sequence of trades.

Related Marble Lab tools

Try the Position Sizing Game to feel the sequence risk, or the Drawdown Recovery Calculator to see why deep drawdowns are such annoying little beasts.