Position Sizing

This is the rule that keeps you in the game.
One bad trade never ends your account — because we size intelligently.

The Turtle Position Sizing Formula

Shares = (Account Equity × Risk %) ÷ (ATR × Multiplier)
Account Equity Your current total balance
Risk % 1% or 2% — never more
ATR 20-day Average True Range
Multiplier Usually 1 or 2 (Turtle classic: ~1)

This equation is why Turtle traders could lose 10 trades in a row and still have most of their money left.

Real Example: Your $50,000 Account Right Now

You risk 1% ($500) per trade.
You spot a breakout — here's how many shares you can actually buy depending on volatility:

What You Can Buy

Low volatility (ATR = $4.20) Stop ≈ $8.40 → $500 ÷ 8.40 = 59 shares
Medium volatility (ATR = $6.00) Stop ≈ $12.00 → $500 ÷ 12.00 = 42 shares
High volatility (ATR = $8.40) Stop ≈ $16.80 → $500 ÷ 16.80 = 29 shares

Same $500 risk every time — volatility only changes how many shares you hold.

How Size Changes with Volatility

Low Vol 59 shares Med Vol 42 shares High Vol 29 shares Same $500 Risk – Volatility Changes Size Higher ATR = smaller position to keep risk fixed
Higher volatility forces smaller positions to keep your risk fixed at $500 —
that's why Turtle traders survived years of choppy markets without blowing up.

Always the Same Dollar Risk

No matter how wide the stop is, you never risk more than your set percentage.

ATR Keeps It Fair

Volatile stock? Smaller position. Calm market? You can take more shares.

Your Account Survives

Even 10 losing trades in a row — you still have most of your capital left.

Back to Turtle Overview