Free trader tool
Risk-Reward Calculator for Traders
Before you take the trade, know the math. Enter your entry, stop, and target — plus your account size and risk per trade — and get the reward-to-risk ratio, your position size, and the win rate you would need to break even.
Why it matters
The number you should know before you click buy
Reward-to-risk is the cheapest edge in trading and the most often skipped. A trader who only takes setups with a reward-to-risk above some threshold can be wrong more than half the time and still come out ahead; a trader who ignores it can be right most of the time and still lose, because a few oversized losers erase a long string of small wins.
The trap is doing the math in your head under pressure. In the moment, "the stop is close and the target looks far" feels like enough — until you size the position wrong and a single loss costs three winners. The ratio and the position size are simple arithmetic, but they have to be done before the entry, not rationalized after the exit.
This calculator does both at once: the reward-to-risk ratio from your levels, and the exact position size that keeps the loss inside your risk rule. It also shows the breakeven win rate — the honest bar your strategy has to clear to make money at that ratio.
How it works
Enter five numbers. The calculator derives risk and reward per share from your levels, divides your dollar risk by the per-share risk to size the position, and reports the ratio and the breakeven win rate. Direction (long or short) is inferred from whether your target sits above or below your entry.
- 1
Enter your levels
Entry, stop, and target as prices. The distance from entry to stop is your risk; entry to target is your reward.
- 2
Set your risk budget
Your account size and the percent of it you are willing to lose on this trade. One to two percent is a common ceiling, but the calculator uses whatever you enter.
- 3
Read the ratio and the breakeven
The reward-to-risk ratio and the breakeven win rate tell you whether the trade is worth taking; the position size tells you how much to trade so the loss stays inside your rule.
The calculator
Entry price, stop price, target price, account size, and risk per trade as a percent.
Your result
Reward-to-risk ratio, risk and reward per share, position size, dollar risk and reward, and breakeven win rate.
- Position size
- 125 sh
- Risk / share
- 2
- Reward / share
- 6
- Dollar risk
- $250
- Dollar reward
- $750
- Breakeven win rate
- 25.0%
Worked examples
A 3R long, sized correctly
Entry 100, stop 98, target 106. Risk is 2 per share, reward is 6 — a 3-to-1 ratio, with a breakeven win rate of just 25%. On a 25,000 account risking 1% (250), the calculator sizes you at 125 shares: a clean 250 risk for a 750 target. The math, not the gut, sets the size.
A tempting setup that fails the ratio
Entry 50, stop 48.5, target 51. Risk 1.5, reward 1 — only 0.67-to-1, needing a 60% win rate just to break even. The setup might feel good, but the calculator shows you would have to be right three times in five just to tread water. That is the trade reward-to-risk talks you out of.
Reading the breakeven win rate
The breakeven win rate is the most honest output here: at 2-to-1 you need to win 33% of the time, at 1-to-1 you need 50%, at 1-to-2 you need 67%. Compare it to your actual win rate on that setup — if your real win rate is below the breakeven, the setup loses money no matter how good it feels.
FAQ
What is a good risk-reward ratio for trading?
There is no universal number — a good ratio is one your win rate can clear. A 1-to-1 ratio needs you to win more than half your trades; a 3-to-1 ratio is profitable at a 25% win rate. The right move is to compare the breakeven win rate this calculator gives you against your actual win rate on that setup.
How does the calculator size my position?
It multiplies your account size by your risk percent to get your dollar risk, then divides that by the per-share risk (the distance from entry to stop). The result is the number of shares or contracts that keeps your loss at exactly your risk limit if the stop is hit.
Does this work for shorts and for futures?
For shorts, yes — enter a target below your entry and the calculator infers the direction. For futures and options the share-based position size is a simplification; treat the per-unit risk and the ratio as correct, and convert the size to contracts using your instrument's point or tick value.
Is this financial advice?
No. This is an arithmetic tool, not a recommendation to take any trade. It tells you the math of a trade you are already considering; whether to take it, and what risk percent is appropriate for you, is your decision. Trading involves substantial risk of loss.
Track whether you actually honor your ratio
Knowing the ratio is half the battle; logging whether you respected it is the other half. Mettle journals your planned risk-reward against what you actually did, so you can see the trades where the math was right and the discipline was not.
More trader tools
Want the full method behind this tool? Read the guide.