Trade expectancy calculator
Expectancy is the single number that tells you whether your trading makes money over time: the average result of one trade after wins, losses and fees. Enter your win rate, average win, average loss, fees and how often you trade, and this calculator gives your expectancy in dollars and in R, your profit factor and your expected monthly result. It then tests small changes to each input, so you can see which improvement is worth the most.
A month of trading, before and after fees
Expected gross wins, gross losses and fees over a month at your pace.
Which improvement is worth most
Expectancy after one realistic change at a time. Compare the extra profit per month to decide where to focus.
| Change | Expectancy per trade | Per month | Extra per month |
|---|
How expectancy is worked out
Expectancy weighs each outcome by how often it happens. Fees are charged on every trade, win or lose.
Expectancy
Average win times win rate, minus average loss times loss rate, minus fees.
E = win rate × avg win − (1 − win rate) × avg loss − fees
In R
Expectancy divided by your usual risk per trade.
E in R = E ÷ 1R
Profit factor
Gross profit divided by gross loss, both after fees.
PF = (win rate × (avg win − fees)) ÷ ((1 − win rate) × (avg loss + fees))
Monthly result
Expectancy times trades per month.
monthly = E × trades
Break-even win rate
The win rate at which expectancy is zero, fees included.
break-even = (avg loss + fees) ÷ (avg win + avg loss)
Expectancy questions
What is trade expectancy?
Expectancy is the average amount you make or lose per trade over many trades. It combines how often you win with how much you win and lose. A positive expectancy means your method makes money over time; a negative one means it loses, however good individual trades feel.
How do you calculate expectancy?
Multiply your win rate by your average win, subtract your loss rate times your average loss, then subtract fees per trade. With a 40 percent win rate, a $500 average win, a $250 average loss and $5 in fees, expectancy is 0.4 times 500, minus 0.6 times 250, minus 5, which is $45 per trade.
What is profit factor?
Profit factor is gross profit divided by gross loss. Above 1 means you make more than you lose. Many traders consider 1.5 or higher solid and above 2 very strong, though very high figures from a small number of trades are often luck.
Why measure expectancy in R?
R is the amount you normally risk on a trade. Measuring expectancy in R lets you compare periods when you traded different sizes, and turn the result into a return on the account by multiplying by your risk per trade.
How many trades do I need to trust my expectancy?
At least 30, and preferably 100 or more of the same setup. A handful of big winners can make a small sample look much better than the method really is. Keep logging and recalculate every month.
How do fees affect expectancy?
Directly. Every dollar of commission, spread and slippage comes off every trade. For active traders with small average wins, fees can be the difference between a winning and losing method, which is why they are entered separately here.