Risk/Reward Calculator

Enter your entry, target and stop to get the R-multiple — then see the win rate you'd need just to break even, and your expectancy at a win rate you choose. The math that shows why a 45% win rate can still make money. Research and education only — not financial advice.

Direction

Entry price ($)

Target price ($)

Stop price ($)

Your expected win rate (%)

Risk / reward

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Reward per share

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Risk per share

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Break-even win rate

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Expectancy (per $1 risked)

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Why the R-multiple beats the win rate

The risk/reward ratio (your R-multiple) tells you how many dollars you stand to make for every dollar you're risking. At 2R, you only need to win about 34% of the time to break even; at 1R you need over 50%. That's why chasing a high win rate is the wrong goal — a room bragging about a 90% win rate is usually risking $5 to make $1, and one loss erases five wins. Read the risk/reward ratio and profit factor explainers for the full picture, and see it in real numbers: our own published backtest shows a strategy that won only 46.6% of the time (hypothetical/simulated) — the R-multiple is why win rate alone tells you almost nothing.

Common questions

What's a "good" risk/reward ratio?

Many disciplined traders won't take a trade below about 2R, because it keeps the required win rate low enough to survive normal losing streaks. But R-multiple only matters alongside a realistic win rate — a 5R setup you hit 10% of the time is worse than a 2R setup you hit 45% of the time.

What is expectancy?

Expectancy is your average result per dollar risked, blending win rate and R-multiple: (win rate × reward) − (loss rate × risk). Positive expectancy means the process makes money over many trades; negative means it bleeds no matter how good any single trade felt.

Does a positive expectancy guarantee profit?

No. Expectancy is an average over a large sample; any short run can lose, position sizing and costs still matter, and the inputs are your estimates. It's a discipline tool, not a promise — nobody can promise trading outcomes.

Disclosures. This calculator is a research and education tool. Outputs are illustrative estimates based on your inputs, exclude commissions and slippage, and are not a recommendation to buy or sell any security or derivative. Expectancy is a statistical average over many trades and does not predict any individual result. Trading involves substantial risk of loss. ClaudeQuantAlgo is not a registered investment adviser or broker-dealer. You are solely responsible for your own trading decisions. Never risk money you cannot afford to lose.