Trading Expectancy Calculator
Calculate your trading system expectancy — the average amount you expect to win or lose per trade.
The core metric for system viability.
How Trading Expectancy Works
Trading expectancy tells you the average dollar amount you can expect to win or lose per trade over a large sample. A positive expectancy system is profitable over time; a negative one will eventually bankrupt you regardless of short-term luck.
Expectancy formula:
Expectancy = (Win Rate × Average Win) − (Loss Rate × Average Loss)
Where:
- Win Rate = percentage of trades that are profitable
- Loss Rate = 1 − Win Rate
- Average Win = average profit per winning trade (in dollars or %)
- Average Loss = average loss per losing trade (in dollars or %)
Worked example:
- Win rate: 45%
- Loss rate: 55%
- Average win: $320
- Average loss: $180
Expectancy = (0.45 × $320) − (0.55 × $180) Expectancy = $144 − $99 = $45 per trade
This system earns $45 on average per trade placed, despite losing more often than it wins. The key is the reward-to-risk ratio of 320÷180 = 1.78:1.
Minimum viable win rate by reward:risk ratio:
Breakeven Win Rate = 1 ÷ (1 + R:R ratio)
At 2:1 reward-to-risk: Breakeven win rate = 1 ÷ 3 = 33.3%
You only need to win 1 in 3 trades to break even — and profit above that.
Expectancy per dollar risked (E-ratio):
E-ratio = Expectancy ÷ Average Loss = $45 ÷ $180 = 0.25
An E-ratio above 0.20 is considered a solid system by most professional traders.
Track your live expectancy across at least 50–100 trades before evaluating a system — small samples produce misleading results due to variance.