Risk Reward Calculator. Ratio and Break-Even Win Rate
Is the reward worth the risk?
Find the reward-to-risk ratio of a trade, the win rate you need to break even, and the expected profit per trade at the win rate you assume.
- Free, no sign-up
- Runs in your browser
- Shareable results
- Educational only
Enter your numbers.
A long trade gains when the price rises. A short trade gains when it falls.
The price you expect to buy, or sell short, at.
For a long trade this must be below the entry price.
The price where you plan to take profit.
The size of the position.
Commissions and fees to open and close, in total. Enter 0 to ignore.
The share of trades you expect to reach the target.
These are hypothetical assumptions for learning, not forecasts or advice.
Result
Expected profit per trade at different win rates.
View the win-rate table
What the numbers mean.
Ratio and win rate work together.
A trade that risks $1 to make $3 only needs to win 25% of the time to break even. A 1-to-1 trade needs 50% before costs.
Costs shift the break-even.
Fees raise the amount at risk and cut the reward, so the win rate you need rises. Small, frequent trades feel this most.
Expectancy is an average.
A positive expected result describes many trades, not one. Any single trade can still lose, so size positions to survive a losing streak.
About this risk reward calculator.
A risk reward calculator shows whether the potential gain on a trade justifies the potential loss. Enter your entry, stop-loss and target prices, the number of shares, your costs and the win rate you expect. The calculator returns the reward-to-risk ratio, the win rate you need to break even, and the expected profit or loss per trade.
The ratio only means something alongside how often a trade wins, which is why the calculator shows both. Read the glossary entries on position size and drawdown for how losses add up. To size a position from a stop, use the Risk Calculator, and to see the gain needed to recover from a loss, the drawdown recovery calculator.
How the risk reward calculator works in practice.
Using the default inputs: trade direction: long (buy first); entry price $100; stop-loss price $95; target price $110; number of shares 100; total trading costs $10; your assumed win rate 40%.
Money at risk, with costs: $510.00
Potential reward, after costs: $990.00
Break-even win rate: 34.00%
Your assumed win rate: 40.00%
Expected result per trade: $90.00
Expected result per $1 risked: 0.18
Risk per share: $5.00
Reward per share: $10.00
Ratio before costs: 1 : 2.00
With the “Tight stop, big target” preset, reward-to-risk ratio: 1 : 7.10. With the “Low ratio, high win rate” preset, reward-to-risk ratio: 1 : 0.57. Change one input at a time to see which assumption matters most.
How to choose your inputs for the risk reward calculator.
Trade direction. A long trade gains when the price rises. A short trade gains when it falls.
Entry price. The price you expect to buy, or sell short, at.
Stop-loss price. For a long trade this must be below the entry price.
Target price. The price where you plan to take profit.
Number of shares. The size of the position.
Total trading costs. Commissions and fees to open and close, in total. Enter 0 to ignore.
Your assumed win rate. The share of trades you expect to reach the target.
How the risk reward calculator works.
The calculator measures how far your stop and target are from your entry, multiplies by the number of shares, and adds your costs to the risk and subtracts them from the reward. It then finds the win rate where the expected result is zero.
Reward = |target − entry| × shares − costs
Reward-to-risk ratio = reward ÷ risk
Break-even win rate = risk ÷ (risk + reward)
Expected result per trade = win rate × reward − (1 − win rate) × risk
The model assumes the stop and target fill exactly at their prices and that every trade has the same risk and reward. Slippage, gaps, spreads and taxes are not modeled. To size a position from a stop, use the Risk Calculator.
Limits of this risk reward calculator.
The calculator assumes the stop and target fill exactly at their prices and that every trade has the same risk and reward. In practice stops can fill beyond the stop price after a gap, and targets may not be reached. It ignores slippage, spreads, borrowing costs and taxes, and it does not recommend or validate any trade. Expectancy is an average over many trades, not a prediction for one.
Common questions about the risk reward calculator.
What is a risk-to-reward ratio?
It compares the amount you could lose with the amount you could gain on a trade. Risking $1 to make $2 is a ratio of 1 to 2.
What win rate do I need to break even?
Divide the amount at risk by the total of risk and reward. A 1-to-2 trade breaks even at about 33%, before costs.
What is a good risk-reward ratio?
It depends on how often your trades win. A lower ratio needs a higher win rate, and a higher ratio can work with a lower one.
Does a good ratio mean a good trade?
No. The ratio says nothing about the chance of reaching the target. A distant target gives a high ratio but is less likely to be hit.
How is this different from the Risk Calculator?
This one judges a planned trade by its ratio and expected profit. The Risk Calculator works out how many shares fit a risk budget from your stop.
More calculators.
Educational illustration only, not a forecast or personal investment recommendation. Results depend entirely on the assumptions entered.
Further learning: Glossary · Investor.gov: Financial tools and calculators · Research methodology · Financial disclaimer