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Minimum position size

The smallest tradeable quantity, which can force risk above your rule or make the trade impossible.

Every market has a granularity floor: one contract, one micro-lot, one share, or a minimum order value. When your calculated size falls below that floor, the honest answer is to skip the trade, not to round up.

Example: a $6,000 account with a 1% rule has $60 of dollar-risk. A crude oil future with a 40-tick stop risks $400 per contract even in micro-futures form at $40. Taking "just one" turns a 1% rule into a 6.7% rule, and six such trades in a row is a third of the account.

Granularity also shapes which markets suit a small account. Fractional shares, micro futures and small FX lots exist precisely so that sizing stays continuous; without them, a small account is forced into concentration it cannot afford.

Related: position-size-rounding, share-sizing-formula, risk-per-trade, micro-futures

See it drawn

Original diagrams for the ideas on this page. Illustrative, not real market data.

How a position size is worked outAccount size, risk per trade and stop distance feed into one box giving the number of shares.ACCOUNT SIZE$25,000your capitalRISK PER TRADE1%of the accountSTOP DISTANCE$0.50entry to stopPOSITION SIZE500 sharesrisk budget: $25,000 × 1% = $250position size: $250 ÷ $0.50 = 500 shares
Working out a position size. Three numbers decide how big a trade is: the account, the share of it put at risk, and the distance from entry to stop. One percent of $25,000 is a $250 budget, and a $0.50 stop divides into that 500 times.

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