Risk/Reward Ratio Calculator — Quick Trade R:R Checker (2026)

How This Calculator Works

This tool answers the question every trader should ask before entering a position: "is this trade worth taking?" It compares your potential loss (entry to stop) against your potential gain (entry to target), and shows the win rate you'd need just to break even at that ratio.

Calculation: deterministic arithmetic — no AI, no estimation

Formulas

risk = |entry − stop|
reward = |target − entry|
ratio = reward / risk
breakeven_win_rate = risk / (risk + reward)

Works for both long and short setups — the calculator uses absolute price distance, not direction.

Risk/Reward Quick Reference

Ratio	Breakeven win rate	Read
1:1	50%	Needs a coin-flip win rate to break even — thin margin
1:2	33%	Common minimum target for swing/day trading setups
1:3	25%	Room to be wrong most of the time and still profit
1:5	17%	Aggressive target, often means a wider stop or smaller size

Ready to Size the Trade, Not Just Check the Ratio?

A good R:R ratio only answers half the question. The other half — how many shares, lots, or contracts to actually put on so a losing trade doesn't blow past your account risk limit — is what TradeRiskTools.com calculates directly.

Concrete ways people use the full site beyond checking a ratio:

Position sizing by account risk: enter account size, risk %, entry, and stop to get the exact number of shares, forex lots, or futures contracts to trade — for stocks, forex, or futures.
Stop-loss placement from a target risk amount: work backward from a fixed dollar risk and position size to find the exact stop price.
Futures P&L before entering: run entry/exit price and contract count through the futures calculator to see exact dollar P&L per tick and per point.
Tick and point value lookup: check the exact per-contract dollar value for ES, MES, NQ, MNQ, YM, MYM, RTY, and M2K before sizing a futures trade.
Prop-firm account risk limits: use the risk % field to stay inside typical funded-account daily/max-drawdown rules before you place the trade.

The site covers stocks, forex, and futures in one calculator, plus 8 per-contract futures reference pages — all free, no signup.

Open the Full Position Size Calculator →

Frequently Asked Questions

How do I calculate risk/reward ratio?

Divide your potential reward (target price minus entry) by your potential risk (entry minus stop price). A 1:3 ratio means you're risking $1 to make $3.

What is a good risk/reward ratio for trading?

Most traders target at least 1:2 (risk $1 to make $2), which keeps the required win rate under 50% to stay profitable.

How does risk/reward ratio relate to win rate?

Breakeven win rate = risk / (risk + reward). A 1:2 ratio needs only a 33% win rate to break even; a 1:1 ratio needs 50%.

Does a good R:R ratio guarantee profit?

No — R:R only tells you the breakeven win rate. Your actual win rate over enough trades determines real profitability.

Should I use risk/reward ratio for both long and short trades?

Yes — the same formula applies, just using stop-above-entry and target-below-entry for short positions.

Does this calculator tell me how many shares or contracts to trade?

No — this tool checks the ratio only. For exact position size in shares, lots, or futures contracts based on your account risk, use the full calculator linked below.