A portfolio risk calculator aggregates the risk across all your simultaneously open positions, accounting for the fact that correlated positions amplify total exposure beyond what any single trade risk number suggests. It gives you a combined portfolio risk percentage so you can see whether your total exposure is within your personal drawdown policy.
This calculator is for educational purposes only. Results are estimates. Not financial advice.
Enter your values above and click Calculate. Adjust any input to instantly see updated results. All calculations run client-side in your browser - no data is sent to any server.
This tool is built for South African traders using ZAR-denominated accounts or trading international instruments through FSCA-regulated brokers. Values are rounded for readability; full precision is used internally.
Because correlated positions amplify total exposure. If two trades are both long on USD strength, they share risk - a single event can trigger both stops simultaneously, making the combined loss worse than the simple sum.
These are partially correlated because both involve the USD. A correlation of 0.6 (medium) is a reasonable conservative estimate. Positions in completely different asset classes can use 0.3.
Professional traders typically limit total portfolio risk to 3-6% of account equity at any one time. Going above 10% combined risk exposes the account to large single-event drawdowns.
Partially. A hedge in the opposite direction on the same instrument reduces portfolio risk, not increases it. For simplicity, this calculator assumes all positions lose simultaneously.
If your account is in ZAR and you are trading USD pairs, a strong USD move can affect multiple positions simultaneously. South African traders trading USD/ZAR alongside other USD pairs should assume higher correlation.
Yes. Enter each position's individual stop-loss risk percentage. Stocks in the same sector often have 0.6-0.8 correlation during sector-wide events.
No. Gap risk (price jumping through your stop-loss) can make actual losses larger than these calculations show. Add a safety margin, especially for weekend positions.
Simple addition ignores correlation between positions, if your open positions are correlated, your true combined risk can be meaningfully higher than the sum of individual risk figures suggests, this calculator accounts for that relationship.
Generally yes, but only genuinely, if your 'diversified' positions are actually highly correlated (moving together despite being different instruments), the diversification benefit is much smaller than it might appear on the surface.
Ideally whenever you open or close a position, or when correlation relationships between your held instruments shift meaningfully, since your true combined risk exposure changes with both factors.
Yes, if your positions are negatively correlated (tending to move in opposite directions), your true combined portfolio risk can genuinely be lower than a simple sum of each position's individual risk would suggest.
Yes, as long as you can provide reasonable risk and correlation estimates for each instrument, the underlying mathematics apply across different asset classes, though correlation estimates may be less precise for very different instrument types.