About the Trading Expectancy Calculator
Trading expectancy is the average amount you can expect to make or lose per trade if your past win rate and average win and loss hold. This calculator combines those three numbers, plus an optional cost per trade, into expectancy in money and in R (multiples of your average loss), the profit factor, the payoff ratio and the minimum win rate your system needs to break even.
It is for active traders reviewing a journal, testing a strategy idea or deciding whether a high win rate with small winners beats a low win rate with big winners. Enter the number of trades you plan to take to see the expected total profit over that sample.
Expectancy is a long-run average: individual trades and short runs will deviate a lot from it, and a positive figure from a small sample may not persist. Use at least 30 to 50 trades of history, include commissions and slippage, and pair the result with a position size calculator to control risk per trade.
With the default inputs, the expectancy per trade is $52.50. Change any value above to recalculate instantly.
How to use the trading expectancy calculator
- 1Count winners and total trades from your journal to get the win rate.
- 2Enter the average winning and average losing trade in money.
- 3Add commissions and slippage per trade if they are not already included.
- 4Enter how many trades you plan to take.
- 5Check that expectancy is positive and your win rate is comfortably above breakeven.
Formula and method
Expectancy weights the average win by the probability of winning and the average loss by the probability of losing, then subtracts per-trade costs. Dividing it by the average loss expresses it in R, which lets you compare systems that trade different sizes: 0.35R means you make 35% of your typical loss per trade on average.
The profit factor is gross winnings divided by gross losses over the same trades (above 1 is profitable before costs). The payoff ratio compares the size of the average win with the average loss. The breakeven win rate is the win rate at which expectancy, including costs, is exactly zero.
- E
- Expectancy per trade
- W
- Win rate (decimal)
- AvgWin
- Average profit on winning trades
- AvgLoss
- Average loss on losing trades (positive)
Worked examples
45% win rate, $300 average win, $150 average loss
Winners contribute 0.45 × $300 = $135 and losers cost 0.55 × $150 = $82.50, so expectancy is $52.50 per trade (0.35R). The system breaks even at a 33.3% win rate, and 100 trades would be expected to make $5,250.
High win rate, small winners, $5 costs
0.6 × $100 − 0.4 × $120 − $5 = $7 per trade. Because winners are smaller than losers, the system needs a 56.8% win rate to break even after costs, leaving little margin for error.
Trend follower: 30% win rate, 2.5:1 payoff
Winning only 30% of the time still yields 0.3 × $500 − 0.7 × $200 = $10 per trade, because winners are 2.5 times larger than losers. The breakeven win rate is 28.6%, so the edge is thin.
Frequently asked questions
What is a good trading expectancy?+
Any positive expectancy after costs means the system makes money on average. Many traders look for at least 0.2R to 0.5R per trade so that the edge survives slippage, changing markets and estimation error.
What is the difference between expectancy and profit factor?+
Expectancy is the average profit per trade in money or R. Profit factor is the ratio of gross winnings to gross losses. A profit factor above 1 corresponds to positive gross expectancy; around 1.5 or higher is often considered robust.
How do I calculate breakeven win rate?+
Divide the average loss (plus costs) by the sum of the average win and average loss. With a $300 average win and $150 average loss, breakeven is 150 ÷ 450 = 33.3%.
How many trades do I need for a reliable expectancy?+
More is better. Fewer than about 30 trades gives a very noisy estimate; 100 or more trades across different market conditions gives a much more trustworthy figure.
Does expectancy tell me how much to risk?+
No. Expectancy measures the edge, not position size. Use a position size or Kelly criterion calculator to decide how much of your account to risk per trade given that edge.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.