Free tool
Risk/Reward Calculator
Your risk/reward ratio compares how much you stand to lose against how much you aim to make. It also tells you the minimum win rate you'd need just to break even.
Risk : Reward
1 : 3.00
Break-even win rate
25.0%
Win more often than the break-even rate and a strategy with this risk/reward is net positive over many trades — in theory, before spreads, commissions, and slippage.
Why risk/reward matters
Risk is the distance from your entry to your stop-loss; reward is the distance from entry to take-profit. A 1:2 ratio means you risk one unit to make two. The higher the reward relative to risk, the lower the win rate you need to stay profitable: break-even win rate = 1 ÷ (1 + R:R). At 1:2, you only need to be right about 33% of the time to break even — before costs.
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