ATR Position Size Calculator
Key takeaways
- The stop sits 1.5 × ₹45.00 ATR = ₹67.50 below the ₹1,000.00 entry, at ₹932.50.
- The ₹5,000.00 risk budget (1% of ₹5.00 L) ÷ ₹67.50 stop distance allows 74 shares — a stop hit costs ₹4,995.00, ₹5.00 inside the budget from rounding down.
- 74 shares at ₹1,000.00 tie up ₹74,000 — 14.8% of the account.
- At a 2.5× multiplier the stop widens to ₹112.50 (₹887.50) and the same budget allows 44 shares — more room, smaller size.
About the ATR Position Size Calculator
The ATR Position Size Calculator sizes a position the same way the Position Size Calculator does — a risk budget divided by the rupee distance to the stop — except the stop distance is derived from the Average True Range rather than from a stop-loss price chosen by hand. That ties the size to how much the instrument has actually been moving instead of to a round-number distance.
ATR (Average True Range) measures the average size of a period's range, including gaps, usually over 14 periods. It is an input here, not something this page derives: you supply the current ATR from your charting platform rather than a series of highs, lows and closes.
The stop distance is ATR × the multiplier. A larger multiplier places the stop further away, which gives the trade more room before it is stopped out and — because the same risk budget is being divided by a larger number — produces a smaller position. The direction setting decides only which side of the entry the stop price sits on: below it for a long, above it for a short.
"Stop price" is the entry price one stop distance away in that direction; the tile states the price, it does not recommend placing an order there. Position size is the risk amount divided by the stop distance, rounded down to a whole share, and position value and % of capital deployed follow from that share count exactly as they do on the plain Position Size Calculator. All three show an em dash when the stop distance is zero — that is, when either the ATR or the multiplier is zero — while the stop price is still computed and lands on the entry.
Frequently asked questions
What is ATR and where do I get the number?
Average True Range is a volatility measure: the average, over a chosen number of periods, of each period's true range — the greatest of the high-to-low distance, the high-to-previous-close distance and the low-to-previous-close distance, so that gaps are counted. Almost every charting platform computes it as a standard indicator, typically over 14 periods. Read the current value and enter it here.
How is an ATR-based position size calculated?
Stop distance = ATR × Multiplier. Risk amount = Capital × Risk % ÷ 100. Position size = ⌊Risk amount ÷ Stop distance⌋, rounded down to a whole share so the position never risks more than the budget it was sized from.
What ATR multiplier do people use?
Multipliers between 1.5 and 3 are the ones most commonly cited, the trade-off being that a tighter multiple is stopped out by ordinary noise while a wider one costs more per share and therefore allows fewer of them. This calculator applies whatever multiplier you enter; the Key takeaways card shows what the next multiplier up would do to the same budget so the trade-off is visible rather than asserted.
Why does a wider stop give me a smaller position?
Because the risk budget is fixed and the stop distance is the divisor. Doubling the distance halves the number of shares the same budget covers. The rupee amount at risk if the stop is hit stays roughly the same either way — that is the point of sizing this way.
Why use ATR instead of just picking a stop price?
An ATR-derived distance scales with the instrument. The same ₹5 stop is wide on a ₹200 stock and inside a single day's noise on a ₹4,000 one; a stop set at 1.5 ATR is the same distance in volatility terms on both. Whether that suits a given approach is a separate question this calculator does not answer — use the plain Position Size Calculator when the stop price is already decided.
What happens if I set the ATR to zero?
The stop distance becomes zero, so the division has no answer and the position size, position value and % of capital deployed all show an em dash. The stop price is still shown and equals the entry price, since a zero distance moves it nowhere.
Disclaimer: This calculator is for information and education only. It is not investment advice and not a recommendation or a tip, and it does not predict prices. Trading in shares and derivatives carries a risk of loss: futures and sold options are leveraged, and a loss on them can exceed the margin paid. Brokerage differs by broker, and brokerage, taxes and exchange charges change over time. A stop-loss order is not guaranteed to fill at its price; gaps and fast markets can make a loss larger than planned. Every figure is computed solely by applying the formula and assumptions stated on this page to the inputs you entered.