Risk of ruin calculator
Risk of ruin calculator: how deep could your drawdowns go?
A risk of ruin calculator shows your chance of hitting a drawdown you cannot live with. Enter your win rate, average win and risk per trade. It simulates 5,000 accounts to show the drawdowns, losing streaks and outcomes you could face.
- Accounts simulated with every change
- 5,000
- Drawdowns from your highest balance
- 10 to 50%
- Paste real backtest results to use your edge
- Your trades
- No email, account or install
- Free
Risk of ruin calculator
1Your trading
The share of your trades that win.
A winner makes 1.5 times what you risk. Losers lose 1R.
2Your risk
Share of your balance you lose when a trade hits its stop.
Ruin means a drop of
The drawdown from your highest balance you could not live with.
Number of trades
How many trades each simulated account takes.
Position sizing
Most traders risk a share of their current balance, so positions shrink after losses. Fixed sizing keeps risking a share of the starting balance.
3Your risk of ruin
Chance of a 20% drop within 500 trades
23%
About 1 in 4 accounts
Measured from each account's highest balance, across 5,000 simulated accounts.
- 10% drop95%
- 20% drop23%
- 30% drop2%
- 40% drop<1%
- 50% drop0%
Typical worst drop
16%
Half of accounts saw a drawdown this deep
Bad case
24%
1 in 10 accounts dropped this far or more
Losing streak to expect
12 in a row
1 in 10 accounts had one at least this long
Accounts in profit
98%
After 500 trades, averaging +0.13R a trade
Where the accounts went
Typical: +80%Chance of a 20% drop by risk
Pick a point to try itRisk per trade
5,000 simulated accounts trading your numbers, each with its own run of luck. Wins and losses are the sizes you set, one trade at a time. A guide, not a promise.
What risk of ruin means
Not whether you lose. Whether you lose more than you can stand.
Risk of ruin is the chance that losses take your account down by a set amount. Here, ruin means a drop from your highest balance. You choose the limit: 10%, 20%, 30% or 50%.
Even profitable strategies have bad runs. Your risk per trade decides whether a normal losing streak becomes a drawdown that ends the account, the challenge or your nerve.
The losing streak will come
Win 45% of the time and ten losses in a row is not rare over a few hundred trades. At 1% risk, that is about 10%. At 3%, about 26%.
What changes your risk of ruin
Four things move it. Risk per trade is the one you control every trade.
Risk per trade
The biggest lever. Halving your risk cuts deep drawdown risk by far more than half.
Your edge
More winners or bigger average wins give you more room to recover from losing streaks.
How long you trade
More trades mean more chances for a bad run to turn up.
How you size
Risking from your current balance shrinks positions after losses, slowing the fall.
Questions, answered
What is risk of ruin in trading?
The chance that losses take your account down by more than you can accept or recover from. This calculator measures risk of ruin as a drop from your highest balance, using the drawdown level and number of trades you choose.
How is risk of ruin calculated?
The calculator simulates 5,000 accounts using your win rate, average win and risk per trade. Each gets its own run of luck. Your risk of ruin is the share that hits your chosen drawdown within the number of trades you set.
What is a good risk of ruin?
As low as you can get it while the account still grows. There is no single right number. It depends on your edge and the drawdown you can accept. The risk chart shows the chance at every risk per trade.
Can I use my own backtest results?
Yes. Choose Paste my trades and enter your results in R, one per trade. The calculator reshuffles your real results instead of assuming every winning trade and every losing trade has the same size.
How much should I risk per trade?
Enough to grow, but not enough for a normal losing streak to do serious damage. Enter your numbers, then move the risk slider. This trading drawdown calculator shows how quickly deeper drawdowns become more likely as risk rises.
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