Given your reward-to-risk ratio, what win rate do you need just to break even? Most traders guess low — and the guess gets worse once fees and slippage are counted. The formula is below, in full, so you can check every number on this page.
This is arithmetic on the numbers you typed, not a forecast. A positive expectancy is an average over a large sample; it says nothing about your next trade, and a real sequence of trades will spend long stretches below the average.
Static reference — these values do not depend on the inputs above. Costs are expressed as a percentage of the amount you risk per trade: risk 100 and pay 5 in total fees plus slippage on a round trip, and you are in the 5% column.
| Reward : risk | No costs | Costs = 5% of risk | Costs = 10% of risk |
|---|---|---|---|
| 0.5 : 1 | 66.7% | 70.0% | 73.3% |
| 0.75 : 1 | 57.1% | 60.0% | 62.9% |
| 1 : 1 | 50.0% | 52.5% | 55.0% |
| 1.25 : 1 | 44.4% | 46.7% | 48.9% |
| 1.5 : 1 | 40.0% | 42.0% | 44.0% |
| 1.75 : 1 | 36.4% | 38.2% | 40.0% |
| 2 : 1 | 33.3% | 35.0% | 36.7% |
| 2.5 : 1 | 28.6% | 30.0% | 31.4% |
| 3 : 1 | 25.0% | 26.3% | 27.5% |
| 3.5 : 1 | 22.2% | 23.3% | 24.4% |
| 4 : 1 | 20.0% | 21.0% | 22.0% |
| 4.5 : 1 | 18.2% | 19.1% | 20.0% |
| 5 : 1 | 16.7% | 17.5% | 18.3% |
Call the amount you risk on a trade 1 unit — one R. A winner returns R units gross, a loser costs 1 unit gross, and costs C (fees plus slippage, expressed in the same units) are paid on every trade, winners and losers alike. With a win rate p:
Check it against the table: at R = 1 and C = 0, p = 1 ÷ 2 = 50%. At R = 2, p = 1 ÷ 3 = 33.3%. At R = 0.5, p = 1 ÷ 1.5 = 66.7%. That is the whole calculator — there is nothing else in it.
Assumptions, stated: every trade risks the same amount, winners take the full target and losers take the full stop, and costs are the same on both. Real trading is messier — partial exits, moved stops, missed fills and gapped stops all shift the numbers. Treat this as the floor your strategy has to clear, not a model of your actual results.
The relationship is 1 ÷ (1 + R), which is a curve, not a line — and the steep part is exactly where most discretionary traders operate. Cutting your reward:risk from 2 to 1 costs you 16.7 percentage points of required win rate. Cutting it again from 1 to 0.5 costs another 16.7 points. But going the other way, from 3 to 5, only buys back 8.3 points.
The practical consequence: at the low-R end, small changes in where you place your target move the bar enormously, while at the high-R end you are already deep into diminishing returns. A trader scalping at 0.5:1 needs to be right roughly two times in three before costs. That is a demanding standard, and it is usually being compared against a remembered win rate rather than a recorded one.
Costs raise the required win rate by C ÷ (1 + R). The numerator is fixed by your broker and the market; the denominator grows with your reward:risk. So the same commission and spread that adds 6.7 percentage points at 0.5:1 adds only 1.7 points at 5:1.
This is why cost drag is a structural problem for high-frequency, low-R styles and close to a rounding error for position traders. It also compounds: the low-R trader takes far more trades, so the same per-trade drag is paid many more times over the same period. If you trade small ratios, your commission schedule and your fills are not admin — they are a first-order part of the strategy.
Expectancy is the average result per trade, in R. It is the only number here that combines win rate, reward:risk and costs into a single figure, which is why it is worth more than any of them alone. A 35% win rate can be excellent or terrible depending entirely on what it is paired with.
It is the percentage of trades you must win, at a given reward-to-risk ratio, for your profits and losses to cancel out exactly. Win more often than that and you are profitable; win less often and you lose money, however good the trades feel. Before costs it is 1 ÷ (1 + R), where R is your reward-to-risk ratio.
33.3% before costs. If fees and slippage together cost 5% of the amount you risk per round trip, it rises to 35.0%; at 10% of risk it rises to 36.7%.
Yes, and they bite hardest at low reward-to-risk ratios. Costs add roughly C ÷ (1 + R) to the required win rate, so the same cost that adds 6.7 percentage points at 0.5R adds only 1.7 points at 5R. At 0.5:1 with costs of 10% of risk, break-even moves from 66.7% to 73.3%.
Expectancy is the average profit or loss per trade, usually quoted in R — multiples of the amount you risk. With a win rate p and reward-to-risk R, net of costs C, expectancy is p × (1 + R) − (1 + C) in units of R. Positive expectancy means the arithmetic is on your side over a large enough sample; it says nothing about any individual trade.
No. A higher reward-to-risk ratio lowers the win rate you need, but wider targets are usually hit less often, so the win rate you actually achieve tends to fall as well. The pair has to be judged together. This calculator tells you which combinations break even — it cannot tell you which combination your strategy can actually produce. Only your own recorded results can do that.
To average a target of T (in R) per trade, you need a win rate of (1 + C + T) ÷ (1 + R). Aiming for +0.2R per trade at a 2:1 reward-to-risk ratio with no costs needs 40.0%, against 33.3% just to break even.
Edgewise is a probability tool for traders. The relevant thing here is not the pitch, it is that we publish our own graded record — our direction engine's next-candle probabilities, which the app itself does not print, logged before the outcome and scored after it, misses included: 2,045 readings over 8 days, calibration grade too few days to grade, calibration error 1.53%.
We built this calculator because the question it answers is the one most often answered wrong, and because a page that shows its formula is a fair advertisement for a product whose whole argument is showing its numbers. Nothing here is gated, and there is nothing to sign up for to use it.
Read the full track record, including the symbols we grade badly →
If you want conditional probabilities on live markets rather than arithmetic on your own numbers, that is the paid product — have a look if it is useful to you, and ignore it if it is not.