Trading Expectancy Calculator

What is trading expectancy?

Trading expectancy is the average amount you can expect to win or lose per trade over a large number of trades. It rolls your win rate together with the size of your average win and average loss into a single number.

A positive expectancy means your system makes money over time, so trading it more, with the same discipline, makes more. A negative expectancy means it bleeds money no matter how good any single trade feels. This is the difference between a strategy with a real edge and one that only feels like it works.

The expectancy formula

Your win rate is the share of trades that close green. Your loss rate is everything else, so the two always add to one hundred percent. Average win is the typical size of a winning trade and average loss is the typical size of a losing one. Multiply each side by how often it happens, subtract the losing side from the winning side, and the result is your expected profit or loss per trade.

A worked example

Say you win 55% of your trades, your average winner is $500, and your average loser is $250. Your winning side is 55% of $500, which works out to $275 per trade. Your losing side is 45% of $250, which is $112.50 per trade.

Subtract the two and your expectancy is +$162.50 per trade. Over 100 trades that is roughly $16,250 in expected profit before costs. Those are the default numbers loaded in the calculator above, so the equity curve you see is the path that math tends to produce.

How to use this calculator

• Enter your win rate. Take your winning trades, divide by your total trades, and multiply by 100.
• Enter your average win and average loss. Use your real numbers from your trade history if you have them, in dollars.
• Read your result. The number is your expected profit or loss per trade. Watch the equity curve to see how that edge plays out across many trades.

How to read your result

A positive expectancy means each trade is worth money to you on average. A negative expectancy means the opposite, and the fix is always one of three things. Win more often, win bigger, or lose less per trade. A break-even system sits at zero, where the winning and losing sides cancel out.

Why the curve is green

You make more per winning trade than you lose per losing trade, and you win often enough for it to add up. Over time this compounds into steady growth.

Why the curve is red

Your losses are eating more than your wins can make back. The system is negative, and trading it more only loses faster.

Why it looks different each time

The equity curve is a random simulation of your stats playing out trade by trade, so the wins and losses land in a different order on every run. Click Resimulate to see another possible path. The overall direction stays the same, but no two runs look identical.

Common mistakes

• Confusing win rate with profitability. A 70% win rate still loses money if your losers are three times the size of your winners.
• Ignoring the reward to risk ratio. Expectancy depends as much on how big your wins and losses are as on how often you win.
• Judging it on too few trades. A handful of lucky wins can hide a negative system. You need a meaningful sample before the number means anything.

Frequently asked questions

What is a good expectancy in trading?

Any positive expectancy is a system worth trading, because it makes money over time. What matters more than a target number is that the expectancy stays positive after costs and that you can repeat the setups that produce it.

Is positive expectancy enough to be profitable?

It is the foundation, but not the whole story. You also need enough trades for the edge to play out, position sizing that survives losing streaks, and the discipline to keep taking the same setups.

How many trades do I need before expectancy is reliable?

There is no hard cutoff, but a few dozen trades is the bare minimum and a hundred or more gives a far steadier read. Small samples are dominated by luck.

What do ideal stats look like?

A stable green curve comes from a win rate above 50% with your average win at least equal to your average loss. For example, a 55% win rate with $150 average wins and $100 average losses gives a strong, steady upward curve.