Investing⏱ 3 min

Risk vs Reward Calculator

Analyze the risk-return profile of investments with Sharpe ratio, standard deviation, and scenario analysis.

Free • Accurate • Instant Results

Risk vs Reward Inputs

$
%
%

Risk/Reward Ratio

⚖️

1:2.50

Potential Gain

📈

$2,000

Potential Loss

📉

$800

Position Size

💰

$10,000

🤖

AI Insights

Personalized analysis based on your inputs

✅

Favorable Setup

A 2.50:1 reward-to-risk ratio is favorable — many traders look for at least 2:1 before entering a position.

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Formula Used

Risk/Reward Ratio

Ratio = Potential Gain / Potential Loss

Variables

Potential Gain= Entry × Target% × Position Size

Example

$2,000 potential gain / $800 potential loss = 2.5:1 ratio

Frequently Asked Questions

Many traders target at least 2:1 or 3:1, meaning the potential reward is 2-3x the risk, allowing profitability even with a win rate below 50%.

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Disclaimer: This calculator is for informational and educational purposes only. Results are estimates based on inputs you provide. They are not financial, tax, investment, or legal advice. Consult a qualified financial professional before making financial decisions. Actual results may vary based on market conditions, tax laws, and individual circumstances.