Calculate risk-based position sizes for long stock trades. Use when user asks about position sizing, how many shares to buy, risk per trade, Kelly criterion, ATR-based sizing, fractional-share sizing, or portfolio risk allocation. Supports stop-loss distance calculation, volatility scaling, and sect

Position Sizer Overview Calculate the optimal number of shares to buy for a long stock trade based on risk management principles. Supports three sizing methods: Fixed Fractional : Risk a fixed percentage of account equity per trade (default: 1%) ATR Based : Use Average True Range to set volatility adjusted stop distances Kelly Criterion : Calculate mathematically optimal risk allocation from historical win/loss statistics All methods apply portfolio constraints (max position %, max sector %) and output a final recommended share count with full risk breakdown. The default output is whole shares. Use fractional only when the user's broker supports fractional shares for the security and order type. When to Use User asks "how many shares should I buy?" User wants to calculate position size for a specific trade setup User mentions risk per trade, stop loss sizing, or portfolio allocation User asks about Kelly Criterion or ATR based position sizing User has a small account where whole share rounding would under deploy a defined risk budget User wants to check if a position fits within portfolio concentration limits Prerequisites No API keys required Python 3.9+ with standard library only Workflow Step 1: Gather Trade Parameters Collect from the user: Required : Account size (total equity) Mode A (Fixed Fractional) : Entry price, stop price, risk percentage (default 1%) Mode B (ATR Based) : Entry price, ATR value, ATR multiplier (default 2.0x), risk percentage Mode C (Kelly Criterion) : Win rate, average win, average loss; optionally entry and stop for share calculation Optional constraints : Max position % of account, max sector %, current sector exposure Optional share mode : Whole shares by default, or fractional shares with fractional share precision N when supported by the broker If the user provides a stock ticker but not specific prices, use available tools to look up the current price and suggest entry/stop levels based on technical analysis. Step 2: Execute Position Sizer Script Run the position sizing calculation: Step 3: Load Methodology Reference Read references/sizing methodologies.md to provide context on the chosen method, risk guidelines, and portfolio constraint best practices. Step 4: Calculate Multiple Scenarios If the user has not specified a single method, run multiple scenarios for comparison: Fixed Fractional at 0.5%, 1.0%, and 1.5% risk ATR based at 1.5x, 2.0x, and 3.0x multipliers Present a comparison table showing shares, position value, and dollar risk for each Step 5: Apply Portfolio Constraints and Determine Final Size Add constraints if the user has portfolio context: Explain which constraint is binding and why it limits the position. Step 6: Generate Position Report Present the final recommendation including: Method used and rationale Exact share count and position value Dollar risk and percentage of account Stop loss price Any binding constraints Risk management reminders (portfolio heat, loss cutting discipline) Small account reminders: fractional shares do not remove broker minimums, spread/slippage, commissions/fees, margin limits, borrow availability, or day trading controls Output Format JSON Report Markdown Report Generated automatically alongside the JSON report. Contains: Parameters summary Calculation details for the active method Constraints analysis (if any) Final recommendation with shares, value, and risk Reports are saved to reports/ with filenames position sizer YYYY MM DD HHMMSS.json and .md . Resources references/sizing methodologies.md : Comprehensive guide to Fixed Fractional, ATR based, and Kelly Criterion methods with examples, comparison table, and risk management principles scripts/position sizer.py : Main calculation script (CLI interface) Key Principles 1. Survival first : Position sizing is about surviving losing streaks, not maximizing winners 2. The 1% rule : Default to 1% risk per trade; never exceed 2% without exceptional reason 3. Default to whole shares : Existing workflows remain integer share by default 4. Floor, never round up : Whole share mode floors to an integer; fractional mode floors to the requested precision so risk and concentration budgets are not exceeded 5. Strictest constraint wins : When multiple limits apply, the tightest one determines final size 6. Half Kelly : Never use full Kelly in practice; half Kelly captures 75% of growth with far less risk 7. Portfolio heat : Total open risk should not exceed 6 8% of account equity 8. Intraday rules are broker specific : FINRA replaced the old pattern day trader day count and $25,000 minimum equity requirements with intraday margin standards effective 2026 06 04, with broker phase in allowed through 2027 10 20. Check the broker's current rules before repeated same day trading in a margin account. 9. Asymmetry of losses : A 50% loss requires a 100% gain to recover; size accordingly

position-sizer