What the break-even win rate means
Your win rate is the share of your closed trades that end in profit. The break-even win rate is the win rate at which total wins exactly cover total losses, so the account neither grows nor shrinks over many trades.
It depends on your reward-to-risk ratio (often written R). This compares the average amount you make on a winning trade with the average amount you lose on a losing trade. If your wins are usually larger than your losses, you can break even while losing more often than you win. If your wins are smaller than your losses, you need to win more often than you lose.
Use the calculator to check your own figures:
Fill in the empty fields to see the result.
| Reward to risk | Without costs | With your costs |
|---|---|---|
| 1 : 0.5 | 66.7% | 66.7% |
| 1 : 1 | 50% | 50% |
| 1 : 1.5 | 40% | 40% |
| 1 : 2 | 33.3% | 33.3% |
| 1 : 2.5 | 28.6% | 28.6% |
| 1 : 3 | 25% | 25% |
| 1 : 4 | 20% | 20% |
| 1 : 5 | 16.7% | 16.7% |
Break-even win rate = 1 / (1 + R); with costs c per trade (in R): (1 + c) / (1 + R). Above it the arithmetic is positive; it says nothing about whether a method reaches it.
Enter your average reward, your average risk and your costs per trade. The calculator returns the win rate you need to break even.
The formula
Without costs, the required win rate trading formula is:
Break-even win rate = risk ÷ (risk + reward)
If you express R as reward divided by risk, this is the same as the familiar form "one divided by (one plus R)". Both give the same answer.
Here is the logic. Over many trades, wins add reward each time and losses subtract risk each time. The account breaks even when the money won equals the money lost. Solve that balance for the share of winning trades and you get the formula above.
How the required win rate changes with R:
| Reward compared with risk | Win rate needed to break even |
|---|---|
| Reward smaller than risk | You need more wins than losses |
| Reward equal to risk | You need as many wins as losses |
| Reward larger than risk | Fewer wins than losses can still break even |
| Reward much larger than risk | Only a small share of wins is needed, but long losing streaks become common |
The last row matters. A high R lowers the break-even win rate, but in practice targets far from the entry are hit less often. A low required win rate does not mean the strategy will actually reach it. For how R works in practice, see risk-reward ratio.
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How costs change the result
Every trade carries costs:
- the spread (the gap between the buy and sell price)
- commission, on accounts that charge it
- swap, the overnight financing charge for positions held past the daily rollover (see swap fees)
- slippage, when your order fills at a worse price than requested
Costs work against you on both sides. A winning trade keeps less than its full reward, and a losing trade loses more than its planned risk. With costs, the formula becomes:
Break-even win rate = (risk + cost) ÷ (risk + reward)
Here, cost is the total cost of a round trip (opening and closing the trade), in the same units as risk and reward: money, pips or points.
The effect is largest when your stop-loss and target sit close to the entry. On short-term trades, the spread can be a large part of the planned risk, so the required win rate rises sharply. On trades with wider stops, the same spread matters less. Always enter realistic costs into the win rate calculator rather than leaving the cost field empty.
Using the number honestly
Breaking even is not a goal in itself. It is the floor. To find out whether a set of trades actually made money, combine win rate and R into trading expectancy.
Some practical points:
- Use your real averages. Take them from a trading journal, not from planned targets. Trades closed early or moved stops change your real R.
- Use enough trades. A short run of results can show a win rate far from the true one, in either direction.
- Expect streaks. Even at or above break-even, losing streaks happen. Size positions so a streak cannot wipe out the account. See position sizing, drawdown and risk of ruin.
- Past results do not guarantee future ones. Market conditions change, and a win rate that held last month may not hold next month.
Leveraged forex and CFD trading can lose money fast, sometimes more quickly than you expect. A win rate above break-even on paper does not protect your account. You still need risk control on every position.
More tools are on the calculators page.
Frequent questions
What is a good win rate for trading?
There is no single good figure. A win rate only means something alongside your reward-to-risk ratio and your costs. Compare your actual win rate with your break-even win rate from the calculator.
Why does a higher R lower the required win rate?
Each win covers more losses. The formula risk ÷ (risk + reward) gets smaller as reward grows compared with risk.
Should I include swap in the costs?
Yes, if you hold positions overnight. Add the typical swap to your round-trip cost so the result reflects how you actually trade.
Does a win rate above break-even mean I will make money?
No. It means your past results were positive on average. Future trades can differ, and costs, slippage or changing conditions can push you below break-even.
Can I calculate this in pips instead of money?
Yes. Use the same unit for risk, reward and costs. The ratio, and so the break-even win rate, comes out the same.