Options Position Size Calculator
Fixed-fractional + Kelly recommendations for any options trade. The single biggest difference between traders who survive year one and those who blow up: position sizing discipline.
Sizing methods explained
Risk a fixed % of account on every trade. 1% is the most-cited number, 2% is the upper bound for moderately aggressive operators. Survives any reasonable losing streak. Compounds slowly but steadily.
Mathematically optimal bet size to maximize long-run growth: f = (p × b - q) / b where p=win rate, q=1-p, b=avg R-multiple. Full Kelly is theoretically optimal but practically too volatile — use ¼ Kelly to ½ Kelly.
An options contract controls 100 shares. A $2 entry / $1 stop on 5 contracts = $500 risk, not $5. Most account blow-ups happen because traders size off the premium instead of the contract notional.
For long options + defined-risk spreads, max loss = the debit paid. Use that as your risk. For naked / credit spreads with assignment exposure, size off the worst-case fill at the wide-leg strike, not the credit.