Risk of Ruin Calculator
Estimate the probability of losing a specified percentage of your account based on your win rate and risk per trade.
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Enter your trading statistics to calculate risk of ruin
Understanding Risk of Ruin
Risk of Ruin (RoR) is the probability that a trader will lose a specified percentage of their account given their win rate, average win/loss, and risk per trade. It is one of the most important metrics for long-term trading survival.
Key Metrics Explained
- Expectancy: The average amount you expect to win or lose per trade. Positive expectancy means your system is profitable over time.
- Kelly Criterion: The mathematically optimal percentage of your account to risk per trade. Most traders use half-Kelly or quarter-Kelly for safety.
- Risk of Ruin: The probability of hitting your defined ruin level. Below 1% is considered safe for professional trading.
How to Reduce Risk of Ruin
- Reduce risk per trade (most effective lever)
- Improve win rate through better trade selection
- Increase average win relative to average loss
- Combine all three for the lowest possible risk of ruin
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