Risk Reward Calculator

What is risk reward ratio?

Risk reward ratio compares how far price must move in your favour to how far it can move against you before the stop. On a long, reward distance is target minus entry and risk distance is entry minus stop, both taken as positive numbers. The gross ratio is their quotient, often written as 1 : R where R is reward per unit of risk. A 1 : 3 trade offers three dollars of upside for every dollar of downside on the chart, before costs.

The ratio is a property of your levels, not of account size. Doubling margin doubles dollar profit and loss but leaves R:R unchanged because both numerator and denominator scale with position size. That is why traders separate “is the setup structurally good?” from “how much should I bet?” — this page answers the first question explicitly and helps with the second through optional sizing modes.

Net R:R subtracts trading fees on the open and on whichever leg closes first. Taker fees on entry and exit eat part of the reward and add to effective risk, so a chart-perfect 1 : 2 can become 1 : 1.8 after two 0.05% legs on a tight stop. Always read the net line before comparing setups across venues with different fee tiers.

Risk reward on crypto perpetuals

Crypto perpetuals quote in USD (or USD-equivalent) with no expiry, so the same entry, stop and target language applies as on spot. Funding payments accrue while you hold and can tilt net P&L even when price hits target, which is why funding fields are optional here. Volatility is higher than on many FX pairs, so stops that look wide in percent may still be only a few hours of range on BTC or ETH.

The worked BTC table above uses example prices from this site, not live marks. It keeps stop and target fixed while leverage changes, which shows that net R:R is stable but ROE at stop and target is not. Use your exchange’s actual fill prices for entry and for partial take-profits; the calculator assumes a single average entry and full size unless you split across two targets with the share field.

For profit at an arbitrary exit price rather than a planned target, use the crypto profit calculator. To see how far price can move before forced closure at a given leverage, use the liquidation price calculator.

Does leverage change risk reward?

No. Leverage sets how much notional you control per dollar of margin: notional = margin × leverage. The distance from entry to stop and entry to target is unchanged, so gross R:R is identical at 5x and 50x. What leverage changes is return on equity (ROE): the same dollar P&L is a larger or smaller percent of the margin you posted.

Higher leverage also moves liquidation closer to entry. ROE at the stop looks worse in percent terms because the same dollar loss is divided by less margin only when you keep margin fixed — if you size from a fixed account risk, higher leverage usually means smaller margin and similar dollar risk. The stop-versus-liquidation warning on this page uses the generic isolated formula with auto maintenance margin; venue-specific rules can differ.

LeverUp lists leverage caps by asset as of 2026-10-19; extreme settings such as 1000x on BTC and ETH leave only a thin buffer before the margin-loss liquidation rule triggers. That does not improve R:R — it only magnifies ROE and liquidation risk. Read what 10x leverage means for a slower introduction before using high multiples.

Fees and break-even win rate

Break-even win rate is the fraction of trades you must win, with a fixed net R:R, to offset losses before slippage and psychology. It is approximately 1 ÷ (1 + R) where R is net reward per unit of risk. At net 1 : 2 you need to win about one third of trades; at 1 : 1 you need half. The table injected at build time lists common ratios.

Fees enter net R:R through both legs and through whichever exit prices you use. A wider stop reduces fee drag as a share of risk on small accounts but increases dollar risk unless you cut size. Partial take-profits at two targets blend reward distance by the share closed at each level, which better matches scaling out than a single TP field alone.

Expected value in the EV table is expressed in R multiples per trade: win rate × R minus loss rate. Positive cells mean an edge on paper; negative cells mean you need either a higher win rate or a wider target relative to the stop. Neither table includes slippage, failed stops in gaps, or the cost of funding over long holds.

From ratio to planning: break-even and expectancy

Traders often pick a minimum R:R before taking a setup — for example demanding at least 1 : 2 after fees — then check whether their historical win rate clears the break-even column. A strategy with 45% wins and net 1 : 1.5 has positive expectancy in R terms (0.45 × 1.5 − 0.55 ≈ +0.125R per trade) before costs not in the model. The EV grid generalises that arithmetic across win rates and ratios so you can sanity-check a journal export quickly.

Break-even win rate rises as net R:R falls. Chasing high win rate with tiny targets and wide stops can still lose if fees dominate. Conversely, low win rate trend systems can survive with large R:R provided execution actually captures the target tail. This calculator does not predict win rate; it only supplies the ratio side of the equation from prices you choose.

Liquidation vs stop-loss

A stop-loss is an order you hope fills near your level. Liquidation is the exchange closing you when margin is exhausted. If the stop sits beyond the liquidation price on a long (below liq), the position can be closed by the engine before the stop triggers, especially in fast markets. The warning on the form flags that ordering using the generic isolated model on this site.

Mitigations are familiar: lower leverage, more margin, a stop inside the liquidation buffer, or isolated margin so one idea does not consume the whole account. Cross margin changes the liq level when other positions draw on the same wallet; this page does not model cross equity, only isolated liquidation at your chosen leverage.

Funding while holding reduces effective margin over time and can pull liquidation slightly toward price on persistent positive funding for longs. Enter optional funding if you plan a multi-day hold; for scalps leaving it at zero is reasonable.

Sizing the trade from risk reward levels

R:R tells you whether the levels are worth trading; sizing tells you how many dollars to put at those levels. The margin mode fixes how much collateral you post and reads notional as margin × leverage. Fixed-dollar risk mode backs into notional from the distance to stop plus fees so that loss at the stop matches your budget. Risk-percent mode uses account size and risk percent the same way the dedicated position size page does, and shows suggested notional and margin alongside the ratio outputs.

If your main question is “how large should I trade for 1% account risk?” start from the position size calculator, which focuses on stop-based sizing and optional take-profit without centring the page on ratio education. Return here when the levels are set and you want net R:R, break-even win rate and ROE at target and stop in one view.

Comparing setups and venues

Compare net R:R, not gross, when fees differ. A 0.04% taker venue and a 0.06% taker venue can invert which setup looks better on a 0.5% stop. ROE at target helps compare how hard margin is working, but only at equal margin — otherwise compare dollar reward at the same notional or the same account risk.

Two targets with a split share model scaling out: half at a conservative target and half at an extended target produces a blended reward distance. If the second target is blank, the calculator uses a single take-profit. Short setups mirror long logic with stop above entry and target below.

Related: position size calculator · liquidation price · crypto profit calculator · methodology · Trade with LeverUp via partner link (not advice).