Risk/Reward Calculator
Target Price
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Risk (pts)
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Ratio
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Reward (pts)
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Execution Plan
Entry
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Stop Loss
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Target
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Enter your entry price and stop loss, select your target reward ratio, and get the exact target price for your trade. Compatible with stocks, forex, and crypto.
Target Price
Risk (pts)
--
Ratio
--
Reward (pts)
--
Entry
--
Stop Loss
--
Target
--
The risk/reward ratio (R/R) compares how much you are willing to lose on a trade versus how much you expect to gain. A ratio of 2:1 means that for every point you risk, you seek to gain two. It is one of the most important concepts in risk management because it determines whether your strategy is profitable in the long run, even with a win rate below 50%.
The calculator takes three inputs:
From those inputs, the target price is calculated as:
Target = Entry + (Entry − Stop Loss) × Ratio
With a 2:1 ratio, you only need to be right on 34% of your trades to break even. With 1:1, you need to be right 50% of the time. A higher ratio gives you more room for error and makes your strategy profitable even when you are wrong more than half the time.
The recommended flow: use this calculator first to verify that the trade has a minimum 2:1 ratio before executing it. Once the ratio is confirmed, use the Position Size Calculator to define how many shares, lots, or coins to buy based on your capital and risk percentage.