Risk Reward Calculator

What is the risk-to-reward ratio?

The risk-to-reward ratio compares how much you stand to lose on a trade (entry to stop-loss) against how much you stand to gain (entry to take-profit). A ratio of 1:2 means you're risking one unit to make two. It's one of the most important numbers in trading because it tells you, before you enter, whether a trade is worth taking.

Break-even win rate

The ratio also reveals how often you need to be right just to break even. With a 1:2 ratio you only need to win about 33% of the time; with 1:1 you need 50%. This is why traders chase higher reward-to-risk setups — a good ratio lets you be profitable even when most trades lose.

How to use it

• Set your stop-loss at the price where your trade idea is proven wrong.
• Set your take-profit at a realistic target, not a hopeful one.
• Many traders avoid setups below ~1:1.5 or 1:2.

FAQ

How do I calculate the risk-to-reward ratio?

Divide the distance from your entry to your take-profit (the reward) by the distance from your entry to your stop-loss (the risk). If you risk 10 points to make 20, that's a 1:2 ratio. This tool does the arithmetic for you once you enter the three prices.

What is the break-even win rate?

It's the percentage of trades you need to win just to avoid losing money at a given ratio. With a 1:2 setup you only need to win about 33% of the time; at 1:1 you need 50%. A higher reward-to-risk ratio lowers the win rate required to stay profitable.

What is a good risk-to-reward ratio?

Many traders look for at least 1:1.5 or 1:2 so that winning trades comfortably outweigh losing ones. There's no universal "right" number, though — it depends on your strategy and how often it actually wins. The ratio is only useful alongside a realistic estimate of your win rate.

Is this risk-reward calculator free, and is my data private?

Yes — it's free with no sign-up, and the calculation runs entirely in your browser. The prices you enter are never uploaded or stored on a server.

Does it work for both long and short trades?

Yes. Whether you're buying (long) or selling (short), the ratio is based on the distances from your entry to your stop-loss and take-profit, so it works the same in either direction as long as you enter the correct prices.

Does it work on mobile?

Yes. The calculator is responsive and runs in any phone browser, so you can size up a trade before entering it from anywhere.

Educational tool only — not financial advice. Trading carries risk of loss.