Risk/Reward Ratio Calculator (with Breakeven Win Rate)
Your risk/reward ratio tells you how many dollars you stand to gain for each dollar you risk on a trade. Enter your planned entry, stop-loss, and target prices — we'll calculate the R:R ratio plus the all-important breakeven win rate. A 1:2 R:R only needs a 33% win rate to be profitable; a 1:1 R:R needs more than 50%.
Results
Risk / reward ratio
3.00 : 1
Reward per $1 risked. Most pros require at least 2:1 (i.e., 2.00).
Breakeven win rate
25.00%
The minimum % of trades you need to win to break even at this R:R.
Risk per share
$5.00
Entry minus stop — your downside per share.
Reward per share
$15.00
Target minus entry — your upside per share.
Results update live as you change inputs. This calculator runs entirely in your browser — your numbers are never sent to a server.
Worked example
You're buying at $100 with a stop at $95 (risk = $5/share) and a target at $115 (reward = $15/share). R:R = 15 ÷ 5 = 3.00, meaning you make $3 for every $1 risked. The breakeven win rate is 1 ÷ (1 + 3) = 25%. So even if you only win 1 in 4 trades, you break even — anything above 25% wins is profit. That's why traders chase high-R:R setups: the win-rate burden drops fast.
Frequently asked questions
What's a good risk/reward ratio for trading?
Most professional traders require a minimum 2:1 (you make $2 for every $1 risked). Below 2:1, you need a very high win rate to stay profitable after commissions and slippage. Setups offering 3:1 or better are where most retail traders should focus — they let you be wrong more often and still make money.
What does 1:2 risk reward actually mean?
1:2 means you risk $1 to potentially make $2. So a $100 risk targets a $200 reward. At 1:2, your breakeven win rate is 33.3% — win one out of every three trades and you don't lose money. Win more than 33.3% and you're profitable.
How does R:R interact with win rate?
R:R and win rate together determine profitability. The breakeven curve is: win_rate × reward = (1 − win_rate) × risk. A 70% win rate with 1:1 R:R is profitable; a 30% win rate with 1:3 R:R is also profitable. You don't need a high win rate if your R:R is high enough — and vice versa.
Should I move my target if the trade is going well?
Generally, no. The R:R you calculated at entry was based on your edge for THAT setup. Moving the target mid-trade is usually an emotional decision, not a statistical one. Better practice: define multiple scale-out levels at entry (e.g., sell 1/3 at 1:1, 1/3 at 1:2, hold rest with trailing stop), so target-management is rule-based.
Does this work for short trades?
Yes — the calculator uses absolute distance, so for a short trade where entry is $100, stop is $105 (above), and target is $90 (below), you'd input those values and the ratio still calculates correctly. The risk is the up-distance to your stop; the reward is the down-distance to your target.
What R:R do top traders actually use?
Studies of professional and prop-firm traders consistently show median R:R of 2:1 to 3:1 on closed winners, with win rates of 40-55%. The 'Holy Grail' combination is something like a 50% win rate at 2:1 R:R, which produces a +0.5R expectancy per trade — modest per-trade but powerful when compounded over hundreds of trades.