Risk Calculator

The risk calculator tells you the exact dollar amount (or your account currency equivalent) that you stand to lose if your stop loss is hit on a given trade. It takes your lot size, the number of pips between your entry price and stop loss, and the pip value for the currency pair to compute the total monetary risk. This figure is critical because it lets you compare each trade's risk against your overall account size and your personal risk rules. For a deeper understanding of how much to risk per trade, read our risk per trade guide.

A common rule of thumb is to keep each trade's risk at or below 1–2% of your total account equity. If the risk calculator shows your trade would lose $200 on a $5,000 account, that's 4% — far too high for most strategies. High risk per trade means a short losing streak can wipe out a significant portion of your account. Use this calculator before every trade to verify your risk stays within your plan. Our forex risk management guide covers how to build a comprehensive risk framework that keeps you in the game long-term.

You'll need three pieces of information: your lot size (e.g., 0.10 for a mini lot), your stop loss distance in pips (the number of pips between your entry and stop loss), and the currency pair you're trading. The calculator uses the pair's pip value to convert pips into a dollar amount. If you're unsure of the pip value for your pair, use our pip calculator first to find it. Make sure you enter the correct stop loss distance — even a small mistake here can significantly change your actual risk.

While the lot size calculator works backwards — you tell it how much you want to risk and it tells you what lot size to use — the risk calculator works forwards. You enter your chosen lot size and stop loss, and it tells you the resulting dollar risk. The lot size calculator is best during trade planning when you're deciding how big a position to take, whereas the risk calculator is ideal for double-checking a trade before entry. Both tools complement each other in a solid workflow. Learn how they fit together in our position sizing article.

No, this calculator measures the risk from your entry price to your stop loss price only. It does not include the spread (the difference between the bid and ask price) or any broker commissions, swap fees, or slippage. In practice, your actual loss when a stop loss is hit may be slightly higher due to these additional costs. On major pairs with tight spreads, the difference is usually small, but on exotic pairs or during high-volatility news events, the gap can be significant. Always account for spread in your overall risk assessment.

Prop firms like FTMO, MyForexFunds, and others impose strict daily and maximum drawdown limits — commonly 4–5% daily and 8–10% total. If you don't calculate your risk precisely, a single trade can push you over the daily limit, instantly failing your challenge or funded account. For example, on a $100,000 funded account with a 5% daily drawdown limit, you cannot risk more than $5,000 in a single day. The risk calculator helps you plan trades so you stay safely within these boundaries. Read more in our prop firm rules guide.

By recording the calculated risk amount for every trade in your journal, you can track patterns in your risk-taking over time. You might discover that your biggest losses come from trades where you exceeded your planned risk, or that your most profitable periods coincided with consistently low risk per trade. Combining the risk calculator's output with your journal entries creates a data-driven feedback loop. For tips on building an effective journal, see our trading journal guide. You can also model cumulative risk scenarios with our drawdown calculator.

Absolutely not. This tool provides a mathematical estimate of potential loss based on the inputs you supply. It is designed for educational and planning purposes only. Real market conditions involve slippage, gaps, news volatility, and other unpredictable factors that can cause losses to exceed the calculated amount. Always use your own judgment, follow your trading plan, and consider seeking advice from a qualified financial professional before making trading decisions. Never trade with funds you cannot afford to lose.