Risk/Reward Ratio Calculator
Find your R:R and the win rate you need to break even.
Breakeven win rate = 1 / (1 + R:R). Above this win rate, the strategy is profitable.
A risk/reward calculator measures the ratio between what you risk and what you aim to gain on a trade, and tells you the minimum win rate you need to break even. Enter your entry, stop-loss, and take-profit prices to see your risk, reward, R:R ratio, and breakeven win rate. A strategy with a 1:2 ratio only needs to win about 34 percent of the time to be profitable.
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What is a good risk/reward ratio?
Many profitable traders aim for at least 1:1.5 to 1:3. Higher ratios let you be profitable with a lower win rate, but very high targets are hit less often — there is a trade-off.
How do you calculate breakeven win rate?
Breakeven win rate = 1 / (1 + reward-to-risk ratio). A 1:2 ratio gives 1/(1+2) = 33.3 percent, so you only need to win one in three trades to break even.
Does a higher R:R guarantee profit?
No — it lowers the win rate you need, but if your actual win rate falls below the breakeven line you still lose. R:R and win rate must be considered together.