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About Risk Reward Calculator Online
This tool computes the risk-reward ratio of a trade: how many dollars of profit you stand to gain compared to how many dollars you'd lose if your stop is hit. Enter entry, stop-loss, and target prices, and the tool returns the ratio (e.g., 1:2 means $1 of risk for $2 of potential reward).
Risk-reward is one of the foundational concepts in active trading. A strategy with a poor win rate can still be profitable if its winning trades are large enough relative to its losing trades. Conversely, a high win rate doesn't help if losses are bigger than wins.
Most experienced traders look for ratios of 1:2 or better before entering. The tool lets you check the math in seconds so you can reject trades that don't meet your minimum threshold.
How to use this tool
How to compute the risk-to-reward ratio of a trade
Enter entry
"Entry" is the price you plan to (or did) open at. All three prices must be in the same currency / quote — the tool doesn't normalise across instruments.
Enter target and stop
"Target" is where you'd take profit; "Stop" is where you'd cut losses. The tool uses absolute distances, so target above or below entry both work — direction is inferred from the sign of (entry − stop).
Press Run
Result is riskReward = |target − entry| / |entry − stop|, rounded to 4 decimals. Risk = 0 throws "Risk cannot be 0." — a zero stop distance gives no edge.
Read the ratio
A risk-reward of 2 means you stand to earn $2 for every $1 risked. Pair with a win rate to get expectancy: positive when winRate × reward > lossRate × risk. A 1:3 with 40% win rate breaks even at 25%.