Here is a discussion of RISK:
RISK is always 3 ATR's and if ATR ( ) increases, then position sizes need to be smaller.
For example: Let's say you have a $100,000 account and you want to risk 1% in Tesla . You have to be able to lose $1000 if TSLA drops by 3 ATR's from your entry. So, you figure risk is 8 points (my guess of ATR) times 3 = 24 points to your stop loss. 24 points into $1000 = 45 shares. Keep in mind that 45 shares of Tesla is $8000 or 8% of your capital, but that is what you need to get a 1% risk position on.
Tim 1:32PM EST Thu 5/22/2014