Risk of Ruin Calculator

Calculate the probability of blowing your account based on your trading edge

Your Trading Stats

Enter your trading statistics

55%
20%90%
1%
0.25%5%
20%
10%50%

Risk of Ruin

0.01%

Very Low Risk

at 20% drawdown

Expectancy

+0.65R

Profit Factor

2.44

Survive Losses

20

Kelly Suggests

16.3%

Risk Analysis

How risk of ruin changes with different risk per trade:

0.5%
0.0%
40 losses
1%
0.0%
20 losses
1.5%
0.3%
13 losses
2%
1.2%
10 losses
3%
5.3%
6 losses
5%
17.2%
4 losses

Recommendation

Based on 55% win rate and 2.0R avg winner

Suggested risk:
2.0%

Understanding Risk of Ruin

Risk of Ruin (RoR) calculates the probability that you'll hit a specified drawdown level given your trading statistics. Even profitable strategies can blow up accounts if risk per trade is too high.

< 1% RoR: Excellent

Well-protected account

1-5% RoR: Acceptable

Reasonable for most traders

5-15% RoR: Moderate

Consider reducing risk

> 15% RoR: High Risk

Strongly consider adjusting

Key Factors

Win Rate

Higher win rates reduce RoR, but you can have low RoR with 40% win rate if your winners are big enough.

Risk per Trade

The most controllable factor. Reducing risk dramatically lowers RoR. Most pros use 0.5-1%.

Reward:Risk Ratio

Larger winners relative to losers provides a buffer against losing streaks.

Kelly Criterion

Mathematical formula for optimal bet sizing. We show half-Kelly (safer).