There are two ways to decide how big to trade: a fixed number of contracts (“always 5”) or a fixed dollar risk (“always risk $100”). They sound similar; they produce completely different risk profiles. For scalping, fixed-dollar-risk is the professional default.
Why fixed-contract sizing fails
“Always 5 contracts” ignores the stop. A trade with a $0.20 stop and a trade with a $0.80 stop, both at 5 contracts, risk $100 and $400 respectively — the same “size” taking 4× the risk. Your risk swings randomly with the stop distance and the option's price, so a “normal” loss on a wide-stop trade can be four times a normal loss on a tight one. It feels consistent and isn't.
Why fixed-dollar-risk wins
Fixed-dollar-risk flips it: you decide the dollars first (your 1%), then solve for contracts so the stop-loss equals that number. A tight-stop trade gets more contracts, a wide-stop trade gets fewer, and every trade risks the same amount. That consistency is what makes a track record meaningful and a losing streak survivable — it's the same idea as thinking in R.
Fixed contracts holds the number constant and lets the risk vary. Fixed-dollar-risk holds the risk constant and lets the number vary. Only one of those is risk management.
The one caveat
Fixed-dollar sizing can occasionally call for more contracts than a strike can liquidly absorb (on a very tight stop) — cap size at what fills cleanly. And on a very small account, the math may round to one contract regardless on a very small account. Within those limits, size by risk, not by habit. NoVo sizes to a dollar-risk budget by default — fixed-dollar-risk, automated.