Enter your entry, stop loss and target. We will calculate the ratio and how many trades you need to win to avoid losing money.
Educational tool. Results are indicative and are not financial advice. Always verify values with your broker.
Continue your trading plan with these tools:
The risk/reward ratio compares what you can gain with what you can lose. At 1:1 you need to win more than 50%; at 1:2, more than 33.3%; at 1:3, more than 25%.
Expectancy combines both: expectancy = win rate × ratio − (1 − win rate). Expressed in R (multiples of your risk), it tells you how much you win or lose on average per unit risked.
FormulaRatio = |Target − Entry| ÷ |Entry − Stop| · Break-even win rate = 1 ÷ (1 + Ratio)There is no magic value. A high ratio lets you be profitable with few wins, but a distant target is reached less often. What matters is that, combined with your real win rate, the expectancy is positive.
That, repeating the trade many times with those parameters, the average result is a gain. It relies on past statistics and does not guarantee future results.
No. To be more realistic, subtract spread and commission costs from the target and add them to the stop distance.
On a buy, the stop must be below the entry and the target above. On a sell, the opposite.