Position size is the strategy
Classroom sizing: risk a small, predefined fraction of capital per idea. Size from stop distance. Education only.
- 01Read the note
- 02Write invalidation
- 03Size from the stop
Desk note
Size from the stop, not the story
Traders argue entries. In class we start at invalidation. The distance from entry to the level that proves the idea wrong decides how large the position can be. A tight map can take size. A wide, messy map cannot.
The classroom formula
Write the risk fraction before the session. Keep it small and boring on purpose.
Risk rupees = account × risk fraction
Quantity = risk rupees ÷ stop distance
If the size feels exciting, the stop is too far or the fraction is too large. Cut it.
One thesis, one risk unit
Nifty and Bank Nifty often move together. Two tickets can still be the same bet. Size them as one risk unit, or pick the cleaner chart and leave the other alone.
Before you click
- Write the invalidation price — a level, not a feeling.
- Measure the stop in points or rupees.
- Cap the unit: one idea, one risk.
- Stand down if two traders would argue the map.
What this note is not
Classroom process only. Not a recommendation to buy or sell any instrument, and not a promise of returns.
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