Risk / Reward Calculator
Judge a trade before you take it. Enter your entry, stop-loss and target to get the risk/reward ratio, the win rate you would need just to break even, and the expected value per trade.
How risk/reward is calculated
- 01
Measure your risk: the distance from entry to stop-loss.
- 02
Measure your reward: the distance from entry to target.
- 03
Divide reward by risk. A 1:2 means you stand to make twice what you risk, so you only need to win about a third of the time to break even.
R:R = |Target - Entry| / |Entry - Stop|
Worked examples
Frequently asked questions
What is a good risk/reward ratio?
There is no single answer. A higher ratio lets you be right less often and still profit, but targets that are too far may rarely get hit. What matters is that your ratio and your real win rate produce a positive expectancy.
What is the breakeven win rate?
It is the percentage of trades you must win just to break even at a given risk/reward. At 1:1 it is 50%, at 1:2 about 33%, at 1:3 about 25%.
What is expectancy?
Expectancy is the average result per trade, measured in units of risk (R). Positive expectancy means the strategy makes money over many trades; negative means it loses, no matter how it feels.
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Not financial advice. This calculator is an educational tool, not financial advice. Trading carries substantial risk and you can lose some or all of your capital. Figures are estimates. Verify against your exchange's own margin, fee and liquidation rules before trading.