Free Risk/Reward Ratio Calculator
The risk/reward ratio tells you how many dollars you stand to win versus lose on a trade. Combined with your win rate, it determines whether a strategy is profitable over the long run. This calculator returns the ratio plus the break-even win rate — the minimum win rate you need to be profitable at that ratio.
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How to use this calculator
Three inputs:
- Entry price — where you take the position.
- Stop-loss — where you exit if wrong.
- Target price — where you take profits.
Risk = |Entry − Stop|. Reward = |Target − Entry|. Risk/Reward Ratio = Risk ÷ Reward (e.g. 1:2 means risking $1 to make $2).
Break-even win rate = Risk ÷ (Risk + Reward). At a 1:2 ratio, you need to win only 33.3% of trades to break even (before fees). At a 1:1 ratio, you need 50%. Better ratios mean lower required win rates, but harder targets mean fewer wins — the trade-off is the whole game.