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Risk/Reward Ratio Calculator

Know the math before you take the trade. Enter your entry, stop and target to see the reward-to-risk ratio, the risk and reward in percent, and the win rate you'd need just to break even.

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  • Calculated in your browser, not on our servers
  • Formula shown with your numbers

Your levels

$
$A stop above entry reads as a short.
$
%Your own estimate. It only drives the expectancy row.

Risk / reward

Reward : risk
3.00 : 1
Win more than 25.0% of these trades and the math is in your favor.
Risk per share$2.00 · 4.00%
Reward per share$6.00 · 12.00%
Break-even win rate25.0%
Expectancy at 40% wins+0.60R per trade
The math

$6.00 ÷ $2.00 = 3.00 · break-even = 1 ÷ (1 + 3.00) = 25.0%

Costs and slippage aren't included, and they weigh more on tight stops.

Break-even win rate by ratio

Win rate needed to break even at each reward to risk ratio
Reward : riskBreak-even win rateWins needed per 100 trades
0.5 : 166.7%67
1 : 150.0%50
1.5 : 140.0%40
2 : 133.3%34
3 : 125.0%25
4 : 120.0%20
5 : 116.7%17
10 : 19.1%10

For education and planning. Results are estimates that leave out taxes and may leave out fees and slippage. Not investment advice. Check the numbers against your broker before you trade.

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How it works

Reward-to-risk is the single most useful number in trade planning: reward per share (target − entry) divided by risk per share (entry − stop). A 3:1 trade makes three dollars for every one you risk if it works — so even a modest hit rate can be very profitable.

The break-even win rate makes that concrete. At 2:1 you only need to be right about 1 in 3 times to break even (1 ÷ (1 + 2) ≈ 33%); at 1:1 you need 50%. Pairing a high R:R with a realistic win rate is the heart of an edge — a great win rate with terrible R:R still loses money.

StockSetups shows the R:R on every setup's trade plan, so you can filter for the trades where the reward justifies the risk before you ever place an order.

Frequently asked

What is a good risk/reward ratio?

Many traders look for at least 2:1 (reward twice the risk), though it depends on your win rate. A high R:R lets you be profitable even when you're wrong more often than right.

How do you calculate risk/reward?

Risk = entry − stop. Reward = target − entry. Risk/reward ratio = reward ÷ risk. So an entry at 50, stop at 48 and target at 56 is a risk of 2 and reward of 6, or 3:1.

What win rate do I need at 1:10 risk/reward?

About 9.1%. The break-even win rate is 1 ÷ (1 + 10), so at a 10:1 reward to risk you need to win a little over 1 trade in 11, before costs. At 3:1 it's 25% and at 5:1 about 16.7%.

What is the break-even win rate?

The hit rate at which a given reward:risk nets zero: 1 ÷ (1 + R:R). At 2:1 it's about 33%; win more often than that and the strategy is profitable.

Use it with

Position Size CalculatorAccount, risk and your stop → the exact share count, long or short.Fibonacci CalculatorSwing high and low → the key retracement and extension levels.

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