Tools
R-multiple and risk/reward calculator
Entry, stop and target give you the planned risk/reward and the lowest win rate at which the strategy doesn't lose. Add an exit price to get the trade result in R, add your win rate to get expectancy per trade.
R — the result in units of risk
1R is the amount you risked on the trade. Result in R = (exit − entry) ÷ (entry − stop): one formula for both longs and shorts — for a short the denominator is negative and the sign flips on its own.
Example: a long from 100 with a stop at 95. Exiting at 110 is +2R. Exiting at 94, when the stop slipped by a point, is −1.2R: a loss bigger than the planned risk. Risk $100 and make $150 — that's +1.5R on any account size.
Risk/reward — the plan before entry
Planned RR = |target − entry| ÷ |entry − stop|. Long 100, stop 95, target 115: risk 5, reward 15, RR 3. Short 100, stop 105, target 90: risk 5, reward 10, RR 2.
RR is the trade's promise, R is its outcome. If your average R on winners is well below the planned RR, you're exiting before the target; if losses go deeper than −1R, the stop is moving or slipping.
Breakeven win rate and expectancy
With RR = x a strategy breaks even at a win share W = 1 ÷ (1 + x). RR 1 — 50%, RR 2 — 33.3%, RR 3 — 25%. Expectancy per trade in R = W × RR − (1 − W): a 40% win rate at RR 2 gives +0.2R per trade.
That math assumes full targets and full stops with no fees. Fees and partial exits raise the breakeven bar — which is why the journal computes expectancy from the actual R of closed trades, not from the plan.
Frequently asked questions
- What's the difference between R and RR?
- RR is calculated before entry from entry, stop and target — it's the plan. R is calculated after the exit — it's the outcome. Comparing the two shows whether you stick to the plan.
- What counts as a good risk/reward?
- There's no universal number: RR only means something next to the win rate. RR 3 at a 20% win rate loses, RR 1 at a 60% win rate makes money. Check the pair against the breakeven win rate above.
- Can a loss be bigger than −1R?
- Yes: slippage, a gap, or a moved stop. A −1.2R result means the trade lost 20% more than the planned risk.
Plan versus outcome — for every trade
The Trading OS journal keeps the planned RR and the actual R of each trade side by side and computes expectancy from real results.
No sign-up — the journal runs in your browser; an account is only needed for sync.