Breakeven Win Rate Calculator
Calculate the minimum win rate needed to be profitable given your risk/reward ratio.
Understand the math behind trading profitability.
Break-even win rate is the minimum percentage of trades that must be profitable for a trading system to avoid losing money over time. It is one of the most important metrics in trading strategy evaluation and position sizing.
Core formula: Break-Even Win Rate = Loss Size / (Win Size + Loss Size)
Or using the risk-reward ratio (R:R): Break-Even Win Rate = 1 / (1 + Risk:Reward Ratio)
Where:
- Win Size = average profit per winning trade (in dollars or R multiples)
- Loss Size = average loss per losing trade (typically fixed as 1R)
- Risk:Reward Ratio = Win Size / Loss Size
Break-even win rates by R:R ratio:
| Risk:Reward | Break-Even Win Rate |
|---|---|
| 1:1 | 50.0% |
| 1:1.5 | 40.0% |
| 1:2 | 33.3% |
| 1:3 | 25.0% |
| 1:4 | 20.0% |
| 1:5 | 16.7% |
| 2:1 | 66.7% |
Including transaction costs (commissions + spread): Adjusted Break-Even = (Loss + Cost) / (Win − Cost + Loss)
Expected Value (EV) per trade: EV = (Win Rate × Avg Win) − (Loss Rate × Avg Loss) A positive EV means the system is profitable long-term. A zero EV = break-even.
Worked example: A forex trader targets 1.5× risk per trade ($150 win, $100 loss). Commission: $5 round trip. Break-even = (100 + 5) / (150 − 5 + 100 + 5) = 105 / 250 = 42.0% win rate required
At a 50% actual win rate: EV per trade = (0.50 × $145) − (0.50 × $105) = $72.50 − $52.50 = +$20.00 per trade Over 100 trades: +$2,000 expected profit
Why this matters: Many traders obsess over win rate while ignoring R:R. A 35% win rate with 1:3 R:R (break-even = 25%) is far more profitable than a 65% win rate with 1:1 R:R (break-even = 50%). Track both metrics together.
Ruin probability: Even positive-EV systems go bankrupt if position sizing is too large. Risk no more than 1–2% of account per trade to survive the inevitable losing streaks.