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Tools — Portfolio Heat Calculator

Portfolio Heat Calculator

Add every position you currently have open to see your total risk in one number — portfolio heat, the % of your account you'd lose if every stop-loss got hit at once.

Trade Setup

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Results

Portfolio Heat —
Total Risk ($) —
Total Notional Exposure —
Exposure (% of Account) —
Open Positions —

Risk per position is |entry − stop| × size, independent of direction — a short's stop above entry gives the same risk as a long's stop below. Rows with no entry, stop, or size are ignored.

What is portfolio heat?

Portfolio heat is the total percentage of your account you would lose if every open position hit its stop-loss at the same time. It's the multi-position version of the "risk 1% per trade" rule: if you have five open trades each risking 1%, your portfolio heat is 5% — meaning a simultaneous string of stop-outs (a sharp, correlated market move) could cost you 5% of your account in one hit. Most professional risk frameworks cap total heat somewhere between 5% and 10% of the account, even if each individual trade risk looks small. Exposure (% of account) is a separate number — it's your total notional position size regardless of stop distance, and shows how much leverage/market exposure you're actually carrying.

Frequently Asked Questions

What's a safe level of portfolio heat?
Many professional traders and prop firms cap total portfolio heat at 5-10% of account equity, even when individual trades each risk a small, controlled percentage. The right ceiling depends on how correlated your open positions are — five uncorrelated 1%-risk trades are safer than five highly correlated ones that could all get stopped out by the same market move.
What's the difference between portfolio heat and exposure?
Portfolio heat is what you'd lose if every stop-loss got hit — it depends on how far each stop sits from entry. Exposure is your total position size (notional value) regardless of stop distance — it reflects how much leverage or market exposure you're carrying overall. You can have low heat (tight stops) with high exposure (large position sizes), or the reverse.
Does direction (long or short) change the risk calculation?
No. Risk per position is simply the distance between entry and stop, multiplied by position size — that distance is the same whether the stop sits below a long entry or above a short entry. The calculator doesn't need to know direction, only where your stop actually is.

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