Calculate the probability of losing your entire trading capital based on your win rate and risk per trade.
Tool Status
Probability of Ruin
< 0.01%
Excellent
Survival
100.0%
Expectancy
+0.75%
Edge
37.5%
Store this calculation, analyze compounding growth, and keep a clean history.
Pro Tip: Consistent use of this tool is one of the most important aspects of successful trading.
Risk of Ruin calculates the mathematical probability of losing your entire trading account based on your trading statistics — win rate, risk per trade, and reward/risk ratio.
Even profitable strategies have some probability of ruin if the risk per trade is too high. A 60% win rate with 10% risk per trade has a much higher ruin probability than the same strategy with 2% risk.
This calculator helps you understand why proper position sizing is essential. By reducing risk per trade, you can make the probability of ruin virtually zero.
Position Size
Calculate optimal lot size based on your risk percentage and stop loss distance.
Risk/Reward
Visualize and calculate risk-to-reward ratios for your trade setups.
Drawdown
Calculate the recovery percentage needed after experiencing account losses.
Pip Value
Calculate the monetary value of a pip for any currency pair and lot size.
Profit/Loss
Calculate potential profit or loss based on entry, exit prices, and lot size.
Margin
Calculate the required margin to open a leveraged forex position.
Ideally below 1%. Professional traders aim for less than 0.1% risk of ruin. If your risk of ruin is above 5%, you should reduce your risk per trade immediately.
Higher win rates dramatically reduce risk of ruin, but only when combined with proper position sizing. A 70% win rate with 20% risk per trade can still have significant ruin probability.
Theoretically no, but you can make it negligibly small (like 0.001%) by risking 1% or less per trade with a positive expectancy strategy.