Risk-Based Position Sizing with Draggable Chart Levels
Summary
The document describes a chart indicator for calculating trade size from an entry price, stop level, and a user-selected risk budget. Traders can set risk as a percentage of account balance, a percentage of equity, or a fixed cash amount. The calculation uses the instrument’s tick value and tick size, then rounds the result to the symbol’s permitted volume increment and limits. An optional take-profit level lets the panel display potential reward and the reward-to-risk ratio.
The guide explains how moving the entry and stop lines determines direction and stop distance, and says the panel updates as chart levels move or new market data arrives. It provides configuration options and a warning: very tight stops may produce a calculated size above the instrument’s maximum, so the displayed, capped size may imply less risk than intended. The indicator calculates size only; it does not place or manage orders. No performance testing is reported.
Key ideas
- Position size is calculated from the selected risk budget and the distance between entry and stop.
- Tick value and tick size make the calculation specific to each symbol.
- Risk can be based on balance, equity, or a fixed cash amount.
- An optional target level adds estimated reward and reward-to-risk information.
- Volume limits can cap size, so unusually tight stops require a risk check.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.