Trading Parameters
$200 per trade
Drawdown considered as 'ruin': $5,000
For simulation purposes only
Risk Assessment
Probability of hitting drawdown threshold
Probability of avoiding ruin
Very Poor
+0.00%
Average gain/loss per trade
+0.00% per trade
Estimated compound growth
Risk of Ruin by Win Rate and Risk Level
| Win Rate | 1% Risk | 2% Risk | 3% Risk | 5% Risk |
|---|
Risk of Ruin (RoR) is the probability that your trading account will experience a drawdown large enough to either:
- Force you to stop trading (psychological ruin)
- Reach your pre-defined drawdown limit
- Completely deplete your trading capital
This calculator helps you understand how your win rate, position sizing, and risk/reward ratio affect your probability of significant losses.
Win Rate
Higher win rates dramatically reduce your risk of ruin
Risk Per Trade
Lower risk per trade provides more protection against consecutive losses
Risk/Reward Ratio
Higher R:R ratios require fewer winning trades to be profitable
Expected Value
Positive expectancy trading systems are essential for long-term survival
For a risk of ruin below 5%, aim for these minimum parameters:
| Risk Per Trade | Required Win Rate | With R:R Ratio |
|---|---|---|
| 1% | 40%+ | 1:1.5 |
| 2% | 45%+ | 1:2 |
| 3% | 50%+ | 1:2.5 |
Flow Execution helps you implement proper risk management and position sizing, dramatically reducing your risk of ruin.
Try Flow Execution