This calculator helps you measure the ratio between the risk you take and the potential reward of a trade. Enter your entry price, stop loss, and target price to calculate your risk/reward ratio instantly.
The risk/reward ratio shows how much you stand to gain for every dollar you risk. Traders typically aim for ratios such as 1:2 or 1:3, meaning the potential reward is two or three times greater than the risk.
If your stop loss is $5 below entry and your target is $15 above entry, then your risk/reward ratio is 1:3.
Risk/Reward Ratio = Reward ÷ Risk
To calculate risk reward, you need three inputs: entry price, stop loss price, and target price. The calculator determines both dollar risk and potential reward automatically.
The risk-to-reward ratio helps determine whether a trade setup is worth taking. Even with a lower win rate, high R/R trades can make a strategy profitable.
A proper risk/reward ratio helps control losses and maximize upside. It is one of the most important concepts in trading, especially for forex, crypto and stocks.
• A ratio of 1:3 is generally considered strong.
• A ratio of 1:1 is neutral.
• A ratio below 1:1 means the potential reward is smaller than the risk.
Most traders aim for at least 1:2 or 1:3, meaning the reward is two or three times the risk.
Risk = Entry – Stop Loss. Reward = Target – Entry. Then divide reward by risk.
Yes. Simply enter the price levels in the calculator to get instant results.
Yes, the formula is universal and applies to any market.