Stop Loss Calculator

If you trade whether it’s crypto, forex, or stocks the biggest question is: “How much will you lose if the market reverses?” Our Stop Loss Calculator answers that question. This calculator tells you where to place your stop loss to protect your trading capital. All you have to do is enter your entry price, choose the percentage you want to risk, and specify whether the trade is long or short.

How to use the Stop Loss Calculator?

1. Enter Entry Price the price at which you bought or sold.
2. Enter Risk % – the amount of loss you can afford.
3. Select Trade Type – Long or Short.
4. Press the ‘Calculate Stop Loss’ button – your stop loss price will be displayed immediately.

This is a basic stop-loss calculation without slippage or fees involved.

How does the Stop Loss Calculator work?

The main purpose of placing a stop loss is to control risk. When you take a trade, it is important to decide where to close the trade if the price reverses.

Our stop-loss calculator helps you in this task.

Why is it easy to use?

The calculator asks for just three things:

1. Entry Price
   The price at which you bought or sold an asset.
2. Risk Percentage
   How much % of risk do you want to take? Suppose you want to take a risk of 3%, then it means that if the price reverses by 3% then the trade will be cut.
3. Trade Type
   Long trade means you want to make a profit when the price rises.

Short trade means you want to make a profit when the price falls.

How to calculate stop loss?

The method for calculating stop loss depends on the trade type whether you are long or short. The formula for both is different but very simple.

If you are long, the stop loss formula is:
Stop Loss = Entry Price – (Entry Price × Risk %)

If you are short, the stop loss formula is:
Stop Loss = Entry Price + (Entry Price × Risk %)

Both formulas tell you how to calculate the stop loss, the price at which you should close your trade so that your loss remains within the set limit.

For example, if you bought a stock at $1000 and you want to take a risk of 5%, the stop loss for a long trade would be $950. That means if the price comes to $950, the trade will be closed.

Why is it beneficial?

• You don’t have to think about where to place the SL.
• The risk is fixed in advance.
• You get accurate and fast calculations every time.

Why is stop loss important?

Trading is not just a game of earning profit. The real game is to keep the losses under control. And this is where stop loss plays the biggest role.

Trading without stop loss is like riding a bike without a helmet. As long as everything is fine, it is fine. But once the market turns upside down, there can be a big loss.

It protects your capital

By placing a stop loss, you decide in advance how much loss you can bear if the market goes against you. This does not empty your entire account in one go.

It helps in avoiding emotions

When the price falls, we get scared. And in fear, wrong decisions are often taken. If the stop loss is already placed, then you do not need to look at the chart again and again. The decisions have already been taken.

Prevents continuous loss

Not every trade is right. But it is not necessary to have a big loss in every trade. Stop loss protects you from incurring losses in a series. Small losses are manageable, but big losses can blow away the entire balance.

So, placing a stop loss is not only smart but also necessary especially if you want to trade for the long term.

Tips for beginners: When and where to place a stop loss?

If you are new to trading, the first mistake is either forgetting to place a stop loss or placing it in the wrong place. With the tips given below, you can adopt the right method right from the beginning.

1. Always decide the risk first

Before taking a trade, think about how much loss you can bear. Then set the stop loss according to that %. There is no benefit in placing a stop loss too tight or too far.

2. Place it with logic, not by looking at the chart

Many people place stop loss only on the basis of the chart – like below a previous low. But you should always think according to your capital.

Enter the risk % in the calculator and take the exact price. This will work on the same logic every time.

3. It is important to place it in every trade

Many people think that “this time it will definitely go up,” and leave the stop loss. But no trend is sure. So even if you are 100% sure, still place a stop loss.

4. Stop changing your mind after placing a stop loss

If a stop loss is placed, do not hold that trade again. Look for new opportunities. It is not necessary to beat the market every time, but it is important to protect yourself.

FAQs: Frequently Asked Questions About Stop Loss Calculator