Max Loss Calculator
Set your account-level line in the sand — the loss at which you stop trading — and share it with a friend to hold yourself accountable.
getting back to even after this loss requires +11.1% — losses are asymmetric.
Next in your analysis: odds of ever hitting this line →
How it works
Professional risk management runs on two layers. Per-trade risk (the position size question) protects any single trade from hurting you. The max loss limit is the layer above it: the total account drawdown at which you stop trading entirely, step back, and reassess. Deciding it while you are calm — and telling someone — is what makes it hold when you are not.
The loss runway connects the two layers: a 10% account limit with 1% risked per trade means ten consecutive worst-case losses before you hit your line. If that number feels too small, your per-trade risk is too big for your tolerance — better to learn that here than in a drawdown.
The formula
Max loss = account size × (max loss % ÷ 100). Stop-trading equity = account size − max loss. Loss runway = max loss ÷ (account size × risk per trade % ÷ 100), rounded down. Recovery required = loss % ÷ (100 − loss %) — the asymmetry that makes limits worth having.
Worked example: $25,000 account, 10% max loss, 1% risk per trade → max loss $2,500; stop-trading equity $22,500; runway 10 full-risk losses; recovery from the full loss requires +11.1%.
FAQ
What is a max loss limit?
A pre-committed account-level drawdown — for example 10% of your account — at which you stop trading and reassess. Deciding it before you are losing is the entire point: limits set mid-drawdown tend to move.
Why 10% of my account?
It is a common starting point, not a rule. The right number is the loss you can absorb financially and emotionally without changing how you trade. This calculator works with any percentage.
What is a loss runway?
How many consecutive worst-case trades your limit can absorb. Risking 1% per trade with a 10% account limit gives a runway of 10 full losses — a useful sanity check on whether your per-trade risk matches your tolerance.
Why does recovering from a loss take a bigger gain?
Losses and gains are asymmetric. After losing 10%, your smaller account needs about an 11.1% gain to get back to even; after 50%, it needs 100%. That asymmetry is why loss limits exist.
What does sharing my max loss do?
Telling someone your limit makes it real — a commitment device. The share message includes only your dollar limit and pledge, never your account size or percentage.
Continue your analysis
Educational only — not financial advice. A max loss limit is a self-imposed discipline device, not a guarantee against losses; markets can gap past any plan.