Risk/Reward Ratio Calculator | allavailabletools

Risk/Reward Ratio Calculator

Calculate the potential risk and reward of your trades in USD or INR.

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Risk/Reward Analysis

Risk/Reward Ratio
High Risk Balanced High Reward

Risk Amount

Potential Loss

$0.00

Reward Amount

Potential Profit

$0.00

Risk per Unit

Loss per Unit

$0.00

Reward per Unit

Profit per Unit

$0.00

Understanding Risk/Reward Ratio

What is Risk/Reward Ratio?

The risk/reward ratio measures the potential profit of a trade against its potential loss. It helps traders evaluate whether a trade is worth taking based on the potential upside compared to the downside.

How to Calculate

Risk/Reward Ratio = (Take Profit – Entry Price) / (Entry Price – Stop Loss)

Interpreting the Ratio

  • Ratio > 1: Potential reward is greater than risk (favorable)
  • Ratio = 1: Potential reward equals risk (neutral)
  • Ratio < 1: Potential reward is less than risk (unfavorable)

Tip: Many successful traders aim for a risk/reward ratio of at least 1:2 or higher.