Risk/Reward Ratio Calculator

See the risk/reward ratio for any trade in seconds. Enter your entry, stop-loss, and target, and the calculator shows your ratio, the win rate you would need just to break even, and how much is at risk and at stake.

How the risk/reward ratio works

The risk/reward ratio compares what you could lose with what you could gain on a trade. It is the foundation of disciplined trading, because it tells you whether a trade is worth taking before you place it.

• Risk per share = the distance from your entry to your stop-loss. Example: entry $100, stop $95 = $5 of risk.
• Reward per share = the distance from your entry to your target. Example: entry $100, target $110 = $10 of reward.
• Risk/reward ratio = reward divided by risk. Here, $10 / $5 = a 1:2 ratio.

Risk/reward and your win rate

A better ratio means each winning trade pays for more losing trades. The breakeven win rate is the percentage of trades you would need to win just to break even at a given ratio. At 1:1 you need to win 50% of the time; at 1:2, only about 33%; at 1:3, about 25%. That is why win rate alone can be misleading: a strategy that wins often but has a poor ratio can still lose money.

Risk/reward in copy trading

When you copy a trader, you inherit their risk/reward profile, so it is worth understanding before you follow them. Pair this with the position size calculator to size each trade to your account, and read how to choose a copy trading strategy and managing copy trading risk. With RelayTrades, your position-size and exposure limits are enforced server-side before any copied order is placed.