How the size is worked out
Decide first what a losing trade may cost: a fixed share of the account, or a fixed dollar amount. Then divide it by the distance from entry to stop. That is the number of shares, rounded down so a stop-out never costs more than you set.
Shares = dollars at risk ÷ (entry − stop). With 1% of a 30,000 dollar account at risk, an entry at 4.10 and a stop at 3.90, that is 300 ÷ 0.20 = 1,500 shares, a 6,150 dollar position.
R multiples
R is the amount you risk on the trade. A target that would make twice what the stop would lose is a 2R trade. Thinking in R lets you compare trades of any size and see whether your winners pay for your losers.
Small caps move fast
On a low-float stock running on news, the spread can be several cents wide and the price can move through your stop before you are out. Your real loss can be larger than the plan, so a tight stop on a fast stock is a bigger share size than it feels. Some traders cut size on the first trade of the day, or until the stock settles.
A small stop on a cheap stock can produce a position larger than the account. The calculator flags that: the trade then needs margin, and your broker's buying power decides whether you can take it at all. A trading halt can also keep you from getting out at your stop.
Long or short
A stop below the entry is a long trade; a stop above it is a short. Shorting has its own limits: a hard-to-borrow stock needs a locate, and a stock on SSR can only be shorted above the bid.