Claude Risk & Position Sizing Calculator Prompt Prompt
You are a professional risk manager who has protected trading accounts from ruin for over a decade.
Category
📊 Trading
Difficulty
Intermediate
Models
2
Last Updated
2026-06-28
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📋 Prompt
You are a professional risk manager who has protected trading accounts from ruin for over a decade.
Account: £/$/[account size]
Risk per trade: [risk percentage]%
Stop loss: [stop loss pips/points]
Instrument: [instrument — XAU/USD/EUR/USD/US30/BTC]
Task: Complete position sizing calculation:
1. RISK CALCULATION:
Dollar/pound risk per trade = account × risk%
Position size formula for [instrument]
Exact lot size (standard/mini/micro)
2. SCENARIO TABLE:
Position sizes at 0.5% / 1% / 1.5% / 2% risk with your SL
3. CONSECUTIVE LOSS ANALYSIS:
After 5 consecutive losses at each risk level: account balance, drawdown %
At what point does position sizing need to decrease?
4. COMPOUNDING POSITION SIZES:
How size should increase as account grows
5. PSYCHOLOGICAL RISK GUIDE:
At which dollar amount does this trade start to affect your emotions?
Recommended cap for your current account level
6. RED LINES: 4 absolute rules that protect the account
Account: £/$/[account size]
Risk per trade: [risk percentage]%
Stop loss: [stop loss pips/points]
Instrument: [instrument — XAU/USD/EUR/USD/US30/BTC]
Task: Complete position sizing calculation:
1. RISK CALCULATION:
Dollar/pound risk per trade = account × risk%
Position size formula for [instrument]
Exact lot size (standard/mini/micro)
2. SCENARIO TABLE:
Position sizes at 0.5% / 1% / 1.5% / 2% risk with your SL
3. CONSECUTIVE LOSS ANALYSIS:
After 5 consecutive losses at each risk level: account balance, drawdown %
At what point does position sizing need to decrease?
4. COMPOUNDING POSITION SIZES:
How size should increase as account grows
5. PSYCHOLOGICAL RISK GUIDE:
At which dollar amount does this trade start to affect your emotions?
Recommended cap for your current account level
6. RED LINES: 4 absolute rules that protect the account
POSITION SIZING: £10,000 account, XAU/USD, 1% risk, 35 pip SL
RISK CALCULATION:
Risk per trade: £10,000 × 1% = £100
XAU/USD pip value (per 0.1 lot / mini lot): $1.00/pip
SL pips: 35
Position size: £100 ÷ (35 × £1.00) = 0.286 → round down to 0.28 lots
Verify: 0.28 lots × 35 pips × $1/pip = $9.80 risk ≈ 1% ✅ (slight undershoot is correct — never overshoot)
SCENARIO TABLE:
| Risk % | Dollar risk | Lot size (35 pip SL) |
|---|---|---|
| 0.5% | £50 | 0.14 lots |
| 1.0% | £100 | 0.28 lots |
| 1.5% | £150 | 0.43 lots |
| 2.0% | £200 | 0.57 lots |
CONSECUTIVE LOSS ANALYSIS (at 1% risk):
Start: £10,000
After loss 1: £9,900 (down 1%)
After loss 3: £9,703 (down 3%)
After loss 5: £9,510 (down 4.9%)
After loss 10: £9,044 (down 9.6%)
Conclusion: At 1% risk, 10 consecutive losses = 9.6% drawdown. Account survives and can continue.
At 2% risk:
After 10 losses: £8,171 (down 18.3%) — still recoverable
At 5% risk: After 10 losses = £5,987 (down 40%) — very difficult to recover
PSYCHOLOGICAL GUIDE:
Most traders start to feel emotional when loss > 0.5% of weekly income equivalent
For a £10,000 account: recommend staying at £50–100 per trade (0.5–1%) until account grows to £20,000
RED LINES:
1. NEVER risk more than 2% on a single trade — ever
2. If daily loss hits 3%, STOP trading for the day
3. If weekly loss hits 5%, review the week before trading again
4. If drawdown exceeds 10%, reduce position size by 50%
RISK CALCULATION:
Risk per trade: £10,000 × 1% = £100
XAU/USD pip value (per 0.1 lot / mini lot): $1.00/pip
SL pips: 35
Position size: £100 ÷ (35 × £1.00) = 0.286 → round down to 0.28 lots
Verify: 0.28 lots × 35 pips × $1/pip = $9.80 risk ≈ 1% ✅ (slight undershoot is correct — never overshoot)
SCENARIO TABLE:
| Risk % | Dollar risk | Lot size (35 pip SL) |
|---|---|---|
| 0.5% | £50 | 0.14 lots |
| 1.0% | £100 | 0.28 lots |
| 1.5% | £150 | 0.43 lots |
| 2.0% | £200 | 0.57 lots |
CONSECUTIVE LOSS ANALYSIS (at 1% risk):
Start: £10,000
After loss 1: £9,900 (down 1%)
After loss 3: £9,703 (down 3%)
After loss 5: £9,510 (down 4.9%)
After loss 10: £9,044 (down 9.6%)
Conclusion: At 1% risk, 10 consecutive losses = 9.6% drawdown. Account survives and can continue.
At 2% risk:
After 10 losses: £8,171 (down 18.3%) — still recoverable
At 5% risk: After 10 losses = £5,987 (down 40%) — very difficult to recover
PSYCHOLOGICAL GUIDE:
Most traders start to feel emotional when loss > 0.5% of weekly income equivalent
For a £10,000 account: recommend staying at £50–100 per trade (0.5–1%) until account grows to £20,000
RED LINES:
1. NEVER risk more than 2% on a single trade — ever
2. If daily loss hits 3%, STOP trading for the day
3. If weekly loss hits 5%, review the week before trading again
4. If drawdown exceeds 10%, reduce position size by 50%
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Always calculate position size BEFORE looking at the setup — emotion-based sizing is the most common account-destroying mistake
Round position sizes DOWN, never up — undershooting risk is safe, overshooting is dangerous
During a losing streak, reduce risk temporarily — it protects capital AND psychology
The Kelly Criterion (optimal position sizing based on win rate and RR) is worth understanding, though most traders use a more conservative fraction
Adding to losing positions without having planned this in advance — averaging down is a capital destroyer
Keeping the same lot size regardless of SL distance — this means different trades have wildly different risk amounts
No daily loss limit — once you've hit 3% daily loss, your judgment is compromised
Risking the same on all trades regardless of setup quality — a Tier A setup (3+ confluences) can justify 1.5%, a Tier C setup should be 0.5% or skipped
- What percentage should I risk per trade?Most professional traders risk 0.5–1% per trade. New traders should start at 0.25–0.5%. Above 2% per trade dramatically increases the probability of account ruin during normal losing streaks. The math matters: at 1% risk, you need 50+ consecutive losses to blow a 50% drawdown.
- How do I calculate pip value for XAU/USD?XAU/USD: 1 standard lot = 100 oz of gold. 1 pip = $0.01 movement × 100 oz = $1 per standard lot, so $0.10 per mini lot, $0.01 per micro lot. At $3,000 gold price, 1 pip of XAU/USD is worth $1/lot. This is why small lot sizes are important on gold.
- Should I use fixed dollar risk or percentage risk?Percentage risk is better long-term — as your account grows, your absolute risk grows proportionally, allowing compounding. Fixed dollar risk means you take larger relative risk as your account shrinks (dangerous) and smaller relative risk as it grows (limits upside).
- What is the Kelly Criterion?Kelly Criterion: f = (p × b − q) / b, where p = win probability, b = net win size, q = loss probability. It gives the theoretically optimal fraction to risk per trade. In practice, traders use 1/4 or 1/2 Kelly to reduce variance while maintaining edge.