How often you have to be right, at a given risk/reward, just to end up flat — including the cost drag most calculators quietly ignore.
"R" is one unit of risk — the amount you lose if the stop is hit. Cost in R: if you risk 100 per trade and pay ~5 in spread and fees, that's 0.05. Nothing you type leaves your browser.
With no costs, the breakeven win rate is 1 ÷ (1 + R). Adding a cost of c R per trade:
breakeven win rate = (1 + c) ÷ (1 + R)
It falls out of setting expectancy to zero: w·R − (1−w)·1 − c = 0. And expectancy at any win rate w is w·R − (1−w) − c, expressed in R per trade — the number that actually decides whether a strategy makes money.
Worked example with the defaults: at 2R with a 0.05R cost, breakeven is (1 + 0.05) ÷ 3 = 35.0%, against 33.3% with no costs. A 45% win rate gives an expectancy of +0.30R per trade.
Most versions of this calculator stop at 1 ÷ (1 + R) and hand you a number that's too flattering. The gap looks trivial per trade and isn't in aggregate: the cost term applies to every trade, winners included, so it scales with how often you trade rather than how well.
That's also the strongest argument against marginal trades. Your low-conviction entries carry the same fixed drag as your best ones, but the least expectancy to absorb it — so they're where costs do the most damage. Trading less is a real edge available to anyone, and it costs nothing to implement. We wrote about that here.
| Risk / reward | Breakeven (no costs) | Breakeven at 0.05R cost | At 0.10R cost |
|---|---|---|---|
| 1 : 1 | 50.0% | 52.5% | 55.0% |
| 1.5 : 1 | 40.0% | 42.0% | 44.0% |
| 2 : 1 | 33.3% | 35.0% | 36.7% |
| 3 : 1 | 25.0% | 26.3% | 27.5% |
| 4 : 1 | 20.0% | 21.0% | 22.0% |
Notice that costs hurt proportionally more at low ratios. At 1:1 a 0.10R cost moves the bar five whole points; at 4:1 it moves it two. Scalping into a tight ratio is the most cost-sensitive thing you can do, which is the opposite of how it's usually sold.
It depends entirely on your risk/reward and costs. At 2:1 with modest costs it's around 35%; at 1:1 it's above 52%. There is no useful win-rate target that isn't paired with a ratio.
Not on its own — it's usually a sign of tiny targets and a huge stop, where one loss erases many wins. Advertised win rates without the accompanying ratio and sample size are marketing.
Average profit per trade in units of risk: w·R − (1−w) − c. Positive means the strategy makes money over enough trades; negative means volume accelerates the loss.
Take your typical spread plus commissions plus realistic slippage for one round trip, and divide by the amount you risk per trade. Risking 100 and paying about 5 all-in is 0.05R.
These numbers tell you how much to risk. They can't tell you whether the setup is worth risking anything on — that's a different question, and it's the one we built Tickrify for: paste a chart, get entry, stop, targets and risk, or an honest "no trade". Three analyses free, no card.
Gut-check your next setup freeRelated: Position size calculator · Risk / reward calculator · Our own measured hit rate