Position Sizing for a Prop Evaluation: Fixed-% Method

Almost every blown evaluation traces back to one decision: the trade that was too big. Not the wrong direction, not the bad setup — the size. Get sizing right and a losing streak is survivable; get it wrong and a single trade ends the account.

Fixed-% risk is the method that makes oversizing structurally impossible. Here’s how it works and how to run the numbers.

Why Fixed-% Risk Beats Fixed Lots on an Evaluation

Trading a fixed lot count (say, always two lots) means your dollar risk swings wildly with every stop distance. A tight-stop scalp and a wide-stop swing at the same lot size are completely different bets, and one of them is quietly enormous relative to your drawdown.

Fixed-% risk flips the logic: you decide the percentage of the account you’ll lose if the stop hits — the same on every trade — and the size adjusts to fit. This gives you three things an evaluation demands:

A predictable worst case. Every loss is the same fraction of the account, so a losing streak is arithmetic you’ve already planned for.
Automatic scaling to stop distance. Wider stops get smaller size; tighter stops get more. Your risk stays flat.
A hard ceiling on the damage any one trade can do. No single fill can breach you if the percentage is small.

The r-multiple concept is the natural partner here: when every trade risks the same R, your results become comparable and your expectancy becomes measurable.

The Formula: Risk Amount ÷ Stop Distance

The entire method is one equation:

Position size = risk amount ÷ (stop distance × value per unit)

Work it in order, every time:

Risk amount = account size × your chosen percentage. On a $50,000 account at 0.5%, that’s $250.
Stop distance = the gap between entry and stop, in the instrument’s units (pips, ticks, points).
Value per unit = what one pip/tick is worth per lot or contract.
Divide to get the size that makes the loss equal your risk amount — no more.

Never do this backwards. Picking a size first and then finding a stop that “feels right” is how the risk amount balloons without you noticing. A position size calculator turns this into a two-second check you’ll actually do on every trade.

Choosing 0.5–1% for the Drawdown You Have

The right percentage is the one that lets you take a normal string of losses without approaching the floor. On an evaluation with a modest drawdown allowance, 0.5% to 1% per trade is the common range — and the thinner your cushion, the lower you go.

No cushion yet (early days): stay near the bottom of the range. You have the full distance to the floor and nothing banked.
Cushion built: you can move toward the top of the range within your plan.
Losing streak in progress: cut, don’t hold. Sizing down after losses keeps the floor out of reach.

Do the math on how many consecutive losses your percentage allows before you’re in danger, and make sure that number is comfortably larger than any streak your strategy has historically produced. Check the loss against your live room with a drawdown calculator.

Converting to Lots (Forex) or Contracts (Futures)

The formula is identical across instruments; only the units change.

Forex. Your risk amount divided by (stop in pips × pip value per lot) gives the lot size. Pip value depends on the pair and your account currency, so don’t assume — a lot size calculator handles the conversion, including cross-currency pairs where the quote currency isn’t your account currency.

Futures. Contracts are discrete, so you round down to a whole number and often can’t hit your target risk exactly. Risk amount ÷ (stop in ticks × tick value) gives the raw contract count; take the floor of it. If even one contract exceeds your risk amount at your stop, the honest move is a wider stop or a different setup — not a bigger risk.

The discreteness of futures contracts is a common trap: rounding up to “get closer” silently blows past your fixed percentage.

Adjusting Size as the Drawdown Floor Moves

On evaluations with a trailing drawdown, your real risk budget isn’t the number you started with — it’s your live distance to the current floor, which moves as you profit. Size against that live number.

Recompute your available room before each session, not just at open.
As the floor trails up toward your equity, your effective buffer shrinks — so shrink your size with it.
Once a trailing floor locks (many freeze at the starting balance), banked profit finally becomes real cushion and you can size more freely within your rule.

Anchoring to yesterday’s floor is how traders breach a green account. Size against today’s.

Locking Size Limits So You Can’t Oversize

The method only works if you can’t override it in a weak moment — and the moment you’ll most want to oversize is right after a loss, which is exactly the wrong time. Willpower is the wrong tool here; a hard limit is the right one.

Shibiki enforces maximum size and maximum loss per trade at the broker EA, so an order that exceeds your fixed-% rule is refused rather than filled. Your auto-journaled history then shows whether you actually stuck to your R on every trade — the number that determines whether your edge health (a Wilson confidence interval on your win rate) is even trustworthy. And if you’re running the same strategy across several evaluations, copying across prop accounts applies the identical sizing and limits to all of them, so one correct decision protects every account at once.