Free Stop Loss Calculator
Find the exact price level for your stop loss based on your account size, risk tolerance, and position size. Works for stocks, forex, and futures.
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Try TradeZella →How Stop Loss Is Calculated
A stop loss is the price level where you exit a losing trade to protect your capital. Instead of guessing where to place it, you can calculate the exact price using your account size, risk percentage, and position size.
Dollar Risk = Account Balance × Risk %
Risk Per Share = Dollar Risk ÷ Position Size
Stop Loss (Long) = Entry Price − Risk Per Share
Stop Loss (Short) = Entry Price + Risk Per Share
The formula starts with how much money you can afford to lose on the trade (dollar risk), then spreads that amount across your shares to find the per-share buffer. That buffer is subtracted from your entry price for long positions, or added for short positions.
Example: Long Position
Setup: $25,000 account, 1% risk, buy 200 shares at $150.00
Dollar risk = $25,000 × 1% = $250.00
Risk per share = $250.00 ÷ 200 = $1.25
Stop loss = $150.00 − $1.25 = $148.75
Take profit (2:1) = $150.00 + $2.50 = $152.50
Example: Short Position
Setup: $25,000 account, 2% risk, short 100 shares at $200.00
Dollar risk = $25,000 × 2% = $500.00
Risk per share = $500.00 ÷ 100 = $5.00
Stop loss = $200.00 + $5.00 = $205.00
The 1% Rule
Never risk more than 1% of your account on a single trade. On a $25,000 account, that means your maximum loss per trade is $250. This rule protects your capital from a string of consecutive losses. Even five losing trades in a row would only cost you about 5% of your account, leaving you with plenty of capital to recover.
Stop Loss Placement Tips
- Place stops below key support (for longs) or above resistance (for shorts).
- Account for spread and slippage by adding a small buffer beyond your calculated level.
- Avoid round numbers where many stops cluster. Place your stop a few cents beyond the round number instead.
- Never move your stop loss further from your entry after opening a trade. Widening a stop means increasing your risk, which defeats the purpose of having one.
Track Your Stop Losses Automatically
TradeZella imports your trades from 500+ brokers and tracks your stop loss, entry, and exit on every position. See which stop loss strategies actually protect your capital with 50+ built-in analytics reports.
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Frequently Asked Questions
How do I set a stop loss?
First, decide how much of your account you are willing to risk (usually 1%). Then divide that dollar amount by your number of shares. Subtract the result from your entry price for long trades, or add it for short trades. That gives you the exact price level.
What percentage should my stop loss be?
Most traders risk 1% of their total account per trade. Some aggressive traders go up to 2%. Never risk more than 3% on a single trade. The percentage refers to your account size, not the stock price movement.
Should I use a fixed dollar or percentage stop loss?
Use a percentage of your account, not a fixed dollar amount or a fixed percentage of the stock price. A 1% account risk keeps your position sizing consistent regardless of the stock price or volatility.
What is a trailing stop loss?
A trailing stop adjusts automatically as the price moves in your favor. If you buy at $100 with a $2 trailing stop, your stop starts at $98. If the price rises to $110, the stop moves up to $108. It locks in profits while letting winners run.
Where should I place my stop loss for day trading?
Place your stop below the most recent swing low (for longs) or above the most recent swing high (for shorts). The stop should be at a level where your trade thesis is invalidated. Avoid placing stops too tight, as normal price noise can trigger them.