What is Risk/Reward Calculator?
Calculate risk-to-reward ratio and minimum win rate needed to be profitable with any trading strategy Simply enter your values, and the calculator instantly computes accurate results using standard financial formulas. All calculations are performed entirely in your browser — nothing is stored or transmitted.
Formula Used
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 This 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
Worked Example
Entry: ₹1,000 | Stop Loss: ₹950 | Target: ₹1,150 → Risk: ₹50 | Reward: ₹150 | R:R = 1:3 | Breakeven Win Rate: 25%
Why Use This Tool?
- 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
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.
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