The One Field a Signal Cannot Contain: Your Position Size

We wrote recently about the six things a call has to specify before you can act on it: the instrument, the direction, the entry and whether it is now or later, the stop, the target, and the time it was sent. A message with all six is an instruction. Two strangers who receive it will place the same order.

That is true, and it hides something. They will place the same order in every respect but one, and the one is the only respect that decides what the trade does to their accounts. Nothing in the signal says how big.

This is not an oversight by the channel. Size is genuinely not theirs to give — and the interesting part is what follows from that, because most people following signals resolve the gap the same way, with a habit rather than a decision, and the habit does something to their risk they have never looked at directly.

Why the channel cannot tell you

Four things determine the right size for a trade, and a channel has access to none of them.

• The size of your account. Obvious, and the only one people remember.
• Your broker's contract specification for that instrument. Gold in particular is not standardised the way a currency pair is — what one platform calls a lot, another calls something else, and the money that moves per dollar of price is different on each.
• What you are already holding. A new position is not evaluated alone; it is evaluated against the exposure you already have, which the channel cannot see.
• How much of a losing run you can sit through without changing your behaviour. This is a fact about you, and it is the one that actually binds.

So the field is missing for a good reason. The problem is that a missing field still gets filled in. You cannot place an order without a size, so something supplies one, and if it is not a decision it is a default.

The fixed-lot trap

Here is the default almost everyone uses, including people who would tell you they manage risk carefully: the same position size on every signal. Whatever number the platform remembers from last time.

Think about what that does. Two calls arrive in the same week. One is a tight setup with the stop just under a recent low, a short distance from the entry. The other is a wider idea with the stop beyond a level much further away. Same instrument, same lot size, same account.

They are not the same trade. The money at risk on the second is the money at risk on the first multiplied by the ratio of the stop distances. If one stop is three times as far away as the other, you have taken three times the risk — without deciding to, without noticing, and without any view that the second setup deserved more.

That is the whole mechanism, and it is worth sitting with because of how it interacts with the rest of your record. Your account result is the sum of your trades weighted by their sizes. If sizes are constant and stop distances vary, then the trades that dominate your result are not the ones you judged best — they are the ones that happened to have the widest stops. A month can be decided entirely by which of your ideas needed the most room.

Worse, the bias has a direction. Wide stops cluster in volatile conditions, and volatile conditions are where the surprise sits. Fixed lots quietly concentrate your risk into exactly the trades that were hardest to be right about.

The arithmetic, in the order you actually do it

The fix is to hold the risk constant and let the size vary, which is the same calculation everyone half-remembers. It is worth writing out because the order matters, and because the third step is where nearly all the real-world errors live.

Step one: decide the risk in money, before you see the signal

Not a percentage you look up when a call arrives — a number in currency, set in advance, that applies to any trade. Deciding it while looking at a specific setup is how it moves, and it only ever moves upward, because the setups that make you want more size are the ones you find most persuasive, and being persuaded is not evidence.

Step two: measure the distance to the stop

In the instrument's own units, from the entry the signal specified — not from where price is now, and not from where you actually got filled if you are still deciding whether to take it. Entry to stop. This number is given to you by the signal, which is precisely why a call without a stop cannot be sized at all. That is the concrete reason a stopless signal is unusable rather than merely sloppy: it is not that you are unprotected, it is that there is no arithmetic to do.

Step three: find out what one unit of that distance is worth on your account

This is the step people borrow from the internet, and it is the step you have to measure yourself. It depends on the contract size your broker uses for that symbol, on the currency your account is denominated in, and sometimes on the current exchange rate between that currency and the one the instrument is quoted in.

There are two honest ways to get it. Read your broker's contract specification for the exact symbol you trade — not the general help page, the specification for that symbol, since many brokers list several variants of gold with different sizes. Or open the smallest position the platform allows, look at the profit-and-loss figure, note how much it changes when price moves a known distance, and divide. The second method takes a minute and gives you a number you are certain of.

Write it down somewhere permanent. It does not change unless your broker or your account currency changes, and having it to hand is the difference between sizing correctly and sizing from memory at the moment a call arrives.

Step four: divide

Position size is your risk in money divided by the stop distance multiplied by the value of one unit of distance. An example with invented but explicit numbers, purely to show the shape: an account risking 50 currency units per trade, a stop 20 points away, and a position where each point is worth 1 currency unit per 0.01 lot. Twenty points at one unit each is 20 units of risk per 0.01 lot, so 50 divided by 20 gives 2.5 — you can hold two and a half times the minimum size, which rounds down to 0.02 lots.

Those numbers are illustrative and yours will be different. The point is the shape: the stop distance is in the denominator, so a wider stop produces a smaller position, automatically, every time, without you having to feel cautious about it.

The part nobody writes down: when the answer is no

Do the division and you will eventually get a number below the smallest position your broker will accept. A very wide stop on a small account produces this routinely.

The minimum lot size is a floor under your risk. If the smallest position you can open risks more money than you decided to risk, then this trade is not available to you. That is the complete answer and it is not a failure of anything.

What people do instead is take it anyway, because the setup looked good and the excess seemed small. Notice what that is: the risk limit now applies to trades with narrow stops and gets waived for trades with wide ones. The rule has been inverted by the exact cases it was written for.

There is a legitimate alternative, which is to trade an instrument or a timeframe whose stop distances fit the account you actually have. Skipping the wide ones and taking the narrow ones is a real strategy. Waiving the limit is not.

Two signals can be one bet

Sizing each trade correctly on its own still leaves a way to be much larger than you think. Positions that are separate on the platform are frequently not separate in the market.

Gold and the major currency pairs share a driver. So do the pairs with each other. Take a long in gold and a short in the dollar against something else on the same morning, both sized to the same careful risk, and you have not taken two trades of one unit each — you have taken something closer to one trade of two units, expressed twice. The stops are in different places, which disguises it, but the thing that would move both against you at once is a single event.

You do not need a correlation model for this. The question that does most of the work is: name the single piece of news that would hurt all my open positions at the same time. If you can name it easily, you have one position, and it should be sized as one.

What to log

If you follow a channel and keep any kind of record, record the size you took and the money you had at risk alongside the call itself. Not the lot number on its own — the money, because the lot number means nothing when you read it back in three months and the money means everything.

Then, once a month, do one thing with it: look at whether the risk column is flat. It is supposed to be flat. If it varies, look at what it varies with. If it goes up after wins, you are pressing. If it goes down after losses, you are shrinking, which sounds prudent and reliably means you are smallest exactly when the recovery happens. And if it simply wanders with no pattern, you are not sizing at all — you are typing a number you got used to.

That column is more informative than the outcome column, and almost nobody keeps it.

Common questions

What percentage should I risk per trade?

We are not going to give you a number, and anyone who gives you one without knowing anything about you is producing content rather than advice. What we can tell you is what the number has to satisfy: you have to be able to lose it several times in a row without your behaviour changing, and you have to still be willing to take the next signal exactly as written after the worst run the number can produce. If a losing streak at your chosen size would make you skip trades, hesitate on entries, or move a stop, the size is wrong regardless of what any formula says. Find the number by asking what run of losses you can sit through, not by picking a percentage that sounds professional.

Some channels post lot sizes. Is that better?

It is a different message, and it is only usable if it also states the account it assumes. A lot size with no stated account is a number that happens to be right for one person, and it is being read by thousands who each have a different balance, a different broker, a different account currency. Given the choice, entry and stop are far more valuable to you than a lot size, because from those you can compute the size that is correct for you — and you cannot go the other way.

Should I size up when a setup looks especially good?

Only if you can show that your high-confidence calls actually perform better, from a record where confidence was written down before the outcome was known. Almost nobody has that record, and confidence recalled afterwards is not evidence — the trades you remember being sure about are disproportionately the ones that worked. Until the record exists, variable sizing by conviction is a way of being largest on the trades you were most wrong about, which is the same failure as the fixed lot with an extra step.

What about a signal with no stop?

There is nothing to compute. That is the practical reason it is unusable, and it is a cleaner test than judging whether the call looks careful. Without a stop distance the sizing arithmetic has no denominator, so whatever you enter is a number you invented and attributed to somebody else.

Why we published this

We post free calls on Telegram with entries, stops and targets, and the outcome of each one afterwards, losers included. We also sell a paid room and say so openly, so we have an obvious interest in you following signals at all.

Which is why it is worth being explicit about one thing: we do not publish lot sizes, and we are not going to. Not as a gap to be filled in a future update — the number is not ours to know, and a channel that supplies it is quietly telling every reader that their account looks the same. The rest of the call is ours to get right, and you can check whether we do on the free feed, where the calls and their outcomes are both public.