What is a Risk/Reward Calculator?
A Risk/Reward Calculator is a free online tool that helps you calculate risk-to-reward ratio and minimum win rate needed to be profitable with any trading strategy. FinCalc Pro offers India's most accurate Risk/Reward Calculator with instant results, detailed charts, and step-by-step breakdowns — completely free with no login required.
Risk/Reward Calculator Formula
If R:R = 2, breakeven win rate = 1/(1+2) = 33%. At 1:3 R:R, you only need 25% winners to break even. Higher R:R lets you be profitable with lower win rate.
How to Use Risk/Reward Calculator
- Enter your entry price
- Enter your stop-loss price and target price
- Click Calculate to see risk amount, reward amount, and R:R ratio
- See the minimum win rate needed to be profitable with this setup
- Evaluate if the trade setup is mathematically favorable before entering
Risk/Reward Calculator — Example
Entry: ₹1,000 | Stop Loss: ₹950 | Target: ₹1,150 → Risk: ₹50 | Reward: ₹150 | R:R = 1:3 | Breakeven Win Rate: 25%
Benefits of Using Risk/Reward Calculator
- Mathematically evaluate every trade before risking money
- Find minimum win rate needed for profitability
- Build statistical edge by only taking favorable R:R trades
- Track your actual win rate vs required win rate over time
Frequently Asked Questions — Risk/Reward Calculator
What is Risk/Reward Ratio?
The Risk/Reward ratio compares the potential profit of a trade to its potential loss. A 1:2 R:R means you risk ₹1 to potentially make ₹2. A 1:3 R:R means risking ₹1 to make ₹3. Always aim for R:R of at least 1:2 for any trade.
What is the minimum win rate to be profitable?
It depends on your R:R. At 1:1 R:R, you need 50%+ win rate. At 1:2, you need only 33%. At 1:3, you need only 25%. The formula: Breakeven Win Rate = 1 / (1 + R:R). Higher R:R allows profitable trading even with frequent losses.
Should I ever take a trade with R:R below 1?
Generally no. At R:R below 1 (risking more than potential reward), you need a very high win rate (above 50%) to stay profitable. Most technical setups do not offer consistent 60%+ win rates. Stick to R:R of 1:2 or better for long-term trading profitability.