Risk of Ruin Calculator
Even a winning system can blow up with too much risk per trade. Estimate the probability of hitting your maximum drawdown.
Risk of ruin
Chance of a drawdown big enough to end your account, at a fixed risk per trade.
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Account loss you could not recover from
- Risk of ruin
- 0.03%
How it works
- Uses the classic gambler's-ruin approximation: your edge per trade (win rate × reward − loss rate) and its variability, measured against how many losing trades it takes to reach the ruin level at your risk per trade.
Questions
- How do I lower my risk of ruin?
- Risk less per trade. It is the most powerful input: halving risk per trade cuts the chance of ruin dramatically.
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