Free Tool
Risk/Reward Calculator
Calculate the risk/reward ratio of your trade to ensure proper risk management.
Your Inputs
Risk/Reward Ratio
1:3.00
Excellent
Risk (Loss)
$5.00
5.00%
Reward (Profit)
$15.00
15.00%
Break-even Win Rate
Minimum win rate needed to be profitable
25.00%
Understanding Risk/Reward Ratio
The risk/reward ratio compares the potential profit of a trade to its potential loss. It helps you determine if a trade is worth taking based on the expected return versus the risk.
A 1:2 ratio means you're risking $1 to potentially make $2. Generally, traders look for a minimum ratio of 1:2 to ensure long-term profitability, even with a win rate below 50%.
Risk/Reward Formula
R:R = (Take Profit - Entry) / (Entry - Stop Loss)Risk/Reward Guidelines
1:0.5
Poor
1:1
Fair
1:2
Good
1:3+
Excellent
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Track Your R:R Across All Trades
RizeTrade automatically calculates and tracks your risk/reward ratio and R-multiples for every trade.
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