Risk to Reward Ratio Calculator
Enter your planned risk (stop distance) and reward (target distance) in dollars or points. The calculator returns the R:R ratio and the break-even win rate you need at that ratio.
Key takeaway: A 1:3 risk-reward ratio means you can be profitable with only a 25% win rate. Most traders underestimate how much R-multiple compensates for a lower win rate.
Calculator
Risk-reward ratio = reward ÷ risk (displayed as 1:X). Break-even win rate = 1 ÷ (1 + ratio) × 100%. Example: 1:3 needs ~25% wins to break even before fees.
Results
- Risk-reward
- 1 : 3.00
- Break-even win rate
- 25.0%
- Reward multiple (R)
- 3.00R
How this formula works
Risk-reward ratio = reward ÷ risk (displayed as 1:X). Break-even win rate = 1 ÷ (1 + ratio) × 100%. Example: 1:3 needs ~25% wins to break even before fees.
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FAQ
- What is a good risk-reward ratio?
- Many profitable swing traders target 1:2 or better. Scalpers may accept 1:1 with a higher win rate. The ratio must match your actual win rate — a 1:5 target you never hit is worthless on paper.
- Is risk-reward the same as R-multiple?
- Yes. A 1:3 risk-reward trade is often called a '+3R' winner if risk was one unit. Journals like Profit AI track average R-multiple across trades to show whether targets are realistic.
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