How it works
The key question in stop-loss planning isn't just "how far can it fall" but "what percentage of my total capital am I willing to risk per trade." This tool starts from your risk tolerance and suggests a matching position size. Recovery math is asymmetric — a 10% loss needs an 11% gain to recover, but a 50% loss needs a full 100% gain.
FAQ
Q. How do I choose my stop-loss distance?
A. It's common to base this on the stock's typical volatility (ATR). Too tight a stop on a volatile stock gets triggered by ordinary noise.
Q. Why does position size matter so much?
A. Even a well-placed stop can devastate an account if the position is oversized. Sizing to your risk tolerance is what keeps you in the game long-term.