Position sizing that treats cost as part of the risk

[FXS London Scalper]

Classic sizing: risk 0.5% of the account, divide by the stop distance, get the lot size. The issue is that the stop isn't the only thing you lose on a losing trade. You also pay spread, commission and slippage.

Example with a $10,000 account, 0.5% risk = $50:

• Stop 5 pips on EURUSD.
• Classic sizing: $50 / (5 × $10) = 1 lot.
• Actual loss when stopped: 5 pips + 0.7 pip commission + 0.2 average stop slippage = 5.9 pips, so about $59.

So the "0.5% risk" is really close to 0.6%. Over a losing streak of eight trades that's a difference of almost 1% of the account.

The fix I use:

Lot size = risk amount / ((stop distance + expected cost) × pip value)

With 0.9 pips of cost that gives $50 / (5.9 × $10) ≈ 0.85 lots.

It feels like a small change. But it means my drawdown stats match my plan, and my risk per trade is what I think it is. For gold, where costs are often a larger share of the stop, the difference is even bigger.

Does anyone else build cost into sizing, or do you treat it as part of the expectancy calculation instead?