Trading Expectancy Calculator
Calculate the average amount a strategy makes or loses per trade.
Please note: Trading carries substantial risk of loss. These calculators are planning tools, not trading advice, and no position sizing method prevents losses.
What the Trading Expectancy Calculator does
Expectancy is the average result per trade once wins and losses are weighted by how often each occurs. It answers the only question that matters over a long run: does this strategy make money, and how much per trade?
Formula
Expectancy = (Win rate × Average win) − (Loss rate × Average loss)R multiple = Expectancy ÷ Average lossBreak-even win rate = Avg loss ÷ (Avg win + Avg loss)
Inputs explained
| Input | Unit | Required | Notes |
|---|---|---|---|
| Win rate | % | Yes | — |
| Average winning trade | selected currency | Yes | Accepts more than 0. |
| Average losing trade | selected currency | Yes | Enter as a positive number. Accepts more than 0. |
| Trades per year | number | Optional | Accepts 0 or more. |
| Currency | one of 10 options | Optional | — |
How to use it
- Choose Currency.
- Enter Win rate, Average winning trade and Average losing trade.
- Optionally add Trades per year.
- Select Calculate.
Worked example
45% win rate, average win $600, average loss $300.
- Win rate
- 45
- Average win
- 600
- Average loss
- 300
(0.45 × 600) − (0.55 × 300) = $270 − $165 = $105 per trade, or 0.35R.
Frequently asked questions
What expectancy should I aim for?
Anything above zero is an edge; 0.2R to 0.5R per trade is strong for most retail systems. Consistency across market conditions matters more than a high peak figure.
Does expectancy account for costs?
Only if your average win and average loss are already net of commission, spread and slippage. Use net figures, not gross.
Method and sources
Method. Expected value per trade: (win rate × average win) − (loss rate × average loss).
Assumptions
- The win rate and average outcomes are stable and were measured over a sample large enough to mean something.
- Trades are independent and sized consistently.
Limitations
- Expectancy is an average over many trades, not a forecast of the next one. A positive figure guarantees nothing over any horizon a person actually trades.
- It is acutely sensitive to the inputs, and those are usually estimated from a short and favourable sample.
- Averages hide the distribution: the same expectancy with occasional very large losses is a materially different proposition from one without.