Visualize and calculate risk-to-reward ratios for your trade setups.
Tool Status
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.
The Risk/Reward Ratio (R:R) compares the potential profit of a trade to its potential loss. For example, a 1:3 R:R means you can make 3x what you risk.
Understanding R:R is crucial because it determines the minimum win rate you need to be profitable. With a 1:2 ratio, you only need to win 33% of your trades to break even.
Professional traders typically look for setups with at least a 1:2 risk/reward ratio, meaning the potential reward is at least twice the risk.
Position Size
Calculate optimal lot size based on your risk percentage and stop loss distance.
Drawdown
Calculate the recovery percentage needed after experiencing account losses.
Risk of Ruin
Calculate the probability of losing your entire trading capital based on your win rate and risk per trade.
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.
A minimum of 1:2 is commonly recommended. This means for every $1 you risk, you aim to make $2. Higher ratios like 1:3 or 1:5 are even better but harder to achieve consistently.
With a 1:1 R:R, you need a 50%+ win rate. With 1:2, you only need 33%+. With 1:3, just 25%+. Better R:R ratios allow you to be profitable with fewer winning trades.
Not necessarily. Very high R:R setups (like 1:10) have lower probability. Find a balance between R:R ratio and win probability that suits your strategy.