What the stop-loss calculator does
A stop-loss is the price at which you agree, in advance, to exit a losing trade. This calculator turns your entry price and one of three placement rules — a fixed percentage, a fixed dollar amount, or an Average True Range (ATR) multiple — into a concrete stop price, then works out the two numbers that actually matter for risk: how much you lose per share if the stop is hit, and the total loss across your whole position.
It works for both directions. On a long trade the stop sits below your entry; on a short it sits above. Pick the method that fits your strategy and read the stop price, the risk per share, the total position risk, and the stop distance as a percentage of entry.
The three placement methods and their formulas
All three produce a stop distance; the trade direction only decides the sign.
Percent · long: stop = entry × (1 − stopPct/100) · short: stop = entry × (1 + stopPct/100)
Fixed · long: stop = entry − riskPerShare · short: stop = entry + riskPerShare
ATR · long: stop = entry − ATR × multiplier · short: stop = entry + ATR × multiplier
Once the stop price is set, the downstream risk arithmetic is identical for every method:
risk per share = |entry − stop|
total position risk = risk per share × quantity
stop distance % = risk per share ÷ entry × 100
Worked example
A long entry at $50 with a 2% percentage stop, 100 shares — computed by the same engine that powers the calculator above.
| Step | Value |
|---|---|
| Method | Percent (long) |
| Entry price | $50.00 |
| Stop % | 2% |
| Quantity | 100 shares |
| Stop-loss price = 50 × (1 − 0.02) | $49.00 |
| Risk per share = |50 − 49| | $1.00 |
| Total position risk = 1 × 100 | $100.00 |
| Stop distance | 2.00% |
Percent vs fixed vs ATR — how the methods differ
The methods answer slightly different questions. A percentage stop is the simplest and keeps the distance proportional to price, but it ignores how volatile the asset actually is. A fixed dollar stop risks the same amount per share on every trade, which pairs naturally with a position size calculator. An ATR stop scales the distance to recent volatility, so a choppy stock gets a wider stop and a calm one a tighter stop — which is why it tends to survive normal noise. Here is the same $100 long trade under each rule:
| Method | Stop price | Risk / share | Best when |
|---|---|---|---|
| Percent (2%) | $98.00 | $2.00 | Simple, ignores volatility |
| Fixed ($3) | $97.00 | $3.00 | Same dollar risk every trade |
| ATR (2 × 1.5) | $97.00 | $3.00 | Scales with recent volatility |
Once you have a stop price, the natural next step is to check the trade’s risk-to-reward ratio against a realistic target — a good stop is only half of a sound trade plan.
Assumptions and limitations
- The stop is assumed to fill exactly at the stop price. In practice a triggered stop becomes a market order and can fill worse (slippage, gaps), so the total risk is a lower bound on loss, not a guaranteed cap.
- The percentage method applies a fixed percentage to the entry price — a static stop, not a trailing stop that ratchets with the price.
- For a long trade the stop must be strictly above zero. A fixed or ATR distance larger than the entry price (or a percentage ≥ 100%) drives the stop to zero or below; the calculator flags that as invalid.
- ATR is supplied by you from your charting platform (typically the 14-period value); this tool does not compute ATR from an OHLC price series.
- Currency amounts are per share. Commissions, spread, financing/overnight fees and taxes are excluded from the modeled risk, and correlated risk across multiple open positions is not aggregated.
Interpreting your results
The stop-loss price is the level at which you plan to exit. The risk per share and total position risk are the numbers to act on: total position risk is your modeled maximum loss if the stop fills at the trigger, and it should be a small, fixed slice of your account — many traders cap it near 1% per trade. The stop distance % tells you how much room the price has before the stop triggers; compare it to the asset’s typical daily range so your stop is not sitting inside normal noise. If the calculator flags the stop as invalid, the distance is wider than the entry price — a sign the method or its parameter is mis-set for this instrument.
Risk-by-account-size reference
Before placing any stop, it helps to know what a 1% or 2% risk limit means in real dollars for your account. The table below shows the maximum dollar risk per trade at three common risk percentages across a range of account sizes. Multiply the figure in the table by your share count to sense-check the total position risk the calculator is showing.
| Account size | 0.5% risk | 1% risk | 2% risk |
|---|---|---|---|
| $5,000 | $25 | $50 | $100 |
| $10,000 | $50 | $100 | $200 |
| $25,000 | $125 | $250 | $500 |
| $50,000 | $250 | $500 | $1,000 |
| $100,000 | $500 | $1,000 | $2,000 |
| $250,000 | $1,250 | $2,500 | $5,000 |
Once you know your dollar risk budget, use a position size calculator to convert it into a share count, then verify the trade’s expected payoff with a risk-reward calculator.
Professional tips
- Set the stop where your trade thesis is wrong, not at an arbitrary round number — then let position size, not the stop, control the dollar risk.
- Place the stop just beyond a structural level (a swing high/low or moving average), not exactly on it, so a brief wick doesn’t take you out before the real move.
- Prefer an ATR-based stop on volatile instruments — it widens automatically when the market is choppy, reducing whipsaw exits.
- Account for gap risk on stocks that report earnings or trade thinly overnight: the fill can be well past your stop, so size the position for that possibility.
Common mistakes
- Stops too tight for the volatility. A 0.5% stop on a stock that swings 3% a day is a near-guaranteed exit at a loss — match the distance to the asset.
- Treating total risk as a hard cap. A stop is a market order once triggered; slippage and gaps can make the actual loss larger than the figure shown.
- Widening the stop after entry. Moving a stop further away to avoid being hit turns a small planned loss into a large unplanned one.
- Confusing setting the stop with sizing the position. This tool gives the stop price and per-trade risk; use a position size calculator to convert a risk budget into a share count.
Frequently asked questions
How do I calculate a stop-loss price using the percentage method?+
Multiply your entry price by (1 minus your chosen stop percentage). For a long trade at $50 with a 2% stop: $50 x (1 - 0.02) = $49.00. For a short trade, multiply by (1 + 0.02) instead: $50 x 1.02 = $51.00. The stop sits below entry for longs and above entry for shorts.
What is an ATR-based stop-loss and how do I calculate it?+
An ATR (Average True Range) stop accounts for an asset's recent volatility. The formula is: stopPrice = entryPrice - (ATR x multiplier) for a long, or entryPrice + (ATR x multiplier) for a short. If you entered at $100, the 14-day ATR is $2, and you use a 1.5x multiplier, your stop is $100 - ($2 x 1.5) = $97.00. This method avoids stops being triggered by normal day-to-day noise.
What is the difference between a stop-loss calculator and a position size calculator?+
A stop-loss calculator tells you WHERE to place your stop (the trigger price and resulting risk per share and total risk). A position size calculator tells you HOW MANY shares to buy given a stop price and a risk budget. You typically use a stop-loss calculator first to find the stop price, then feed that stop price into a position size calculator to determine your share count.
Does a stop-loss order guarantee I will exit at the stop price?+
No. When the market reaches your stop price, the stop-loss order converts into a market order and executes at the next available price. In fast markets or on overnight gaps, the fill price can be meaningfully worse than the stop price. This is called slippage. The total risk shown by this calculator is a modeled estimate; your actual loss could be larger.
What percentage stop-loss should I use?+
There is no universally correct percentage. Active day traders commonly use 0.5%-2% stops to stay inside intraday volatility ranges. Swing traders often use 3%-8%. Longer-term investors may use 10%-15% or ATR-based stops to avoid being shaken out by normal pullbacks. The right level depends on the asset's volatility, your time frame, and how much of your account you are willing to risk per trade.
What is risk per share and why does it matter?+
Risk per share (also called dollar risk per share) is the currency difference between your entry price and your stop price: |entryPrice - stopPrice|. It tells you exactly how much you lose on each share if the stop fills at the trigger price. Multiplied by your position size (share count), it gives your total position risk -- the maximum modeled loss on the trade.
How is a stop-loss for a short trade different from a long trade?+
On a long trade you profit when the price rises, so your stop sits BELOW entry to limit downside. On a short trade you profit when the price falls, so your stop sits ABOVE entry to cap losses if the price rises against you. The math inverts the sign: short stopPrice = entryPrice x (1 + stopPct/100) rather than (1 - stopPct/100). The risk-per-share calculation is the same absolute value in both cases.
Can I use this stop-loss calculator for forex or crypto?+
Yes. The formulas are the same for any traded instrument -- stocks, ETFs, forex pairs, futures, or crypto. For forex, entryPrice is typically the pip price or the FX rate (e.g. 1.0850 for EUR/USD), and riskPerUnit is expressed in pips or the quote currency per unit. For crypto, it works the same as equities.
What is the difference between a fixed stop and a trailing stop?+
A fixed stop-loss (calculated here) is set at a specific price level and does not move once placed. A trailing stop follows the price as it moves in your favour -- it ratchets upward on a long position -- and only triggers if the price reverses by a set amount from its peak. This calculator handles the three fixed-stop methods (percent, dollar, ATR). Trailing-stop calculations involve the running high or low, which is a separate tool.
What ATR multiplier should I use for a stop-loss?+
A multiplier of 1.5-2x ATR is common for intraday and short-term swing setups, while 2.5-3x is typical for longer holding periods where you want to avoid being stopped out by normal swings. Using a multiplier below 1x often places the stop inside the asset's typical daily range and leads to frequent premature exits. The multiplier should be calibrated to the asset's behavior and your holding period.
Why would my stop-loss price come out invalid or below zero?+
This happens when the stop distance is larger than the entry price on a long trade. For example, a fixed $30 risk per share on a $25 stock produces a stop at $25 - $30 = -$5, which is impossible since prices cannot go below zero. Similarly, a 100% or greater percentage stop on a long trade results in a stop at or below zero. In these cases the calculator flags the result as invalid and you need to reduce the stop distance.
How does my account size affect where I place a stop-loss?+
Account size sets the dollar budget for each trade. Most risk-management guidelines suggest risking 1%-2% of your trading account per trade. If your account is $20,000 and you risk 1%, your maximum loss per trade is $200. That $200 divided by the risk per share (your entry minus your stop) gives you the maximum share count you can hold. A tighter stop means you can buy more shares within the same budget; a wider stop means you must hold fewer shares. This interplay is why stop placement and position size must be decided together, not in isolation.
Disclaimer
Sources
- FINRA — Stop Orders
- Corporate Finance Institute — Stop-Loss Order
- Britannica Money — Stop-Loss Orders
- Financial Edge Training — Stop-Loss Orders
- SEC — Investor Bulletin: Stop, Stop-Limit, and Trailing Stop Orders
Formula and data last reviewed by the TheCalculatorVault team on 4 July 2026. Figures are for general information, not professional advice.
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