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Risk Tool

The account failure probability, not just the expectancy.

Positive expectancy does not mean zero risk of ruin. This calculator estimates how likely the account is to fail given win rate, payoff ratio, and how much is risked per trade.

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Interactive tool

Risk of ruin

Risk of ruin
<0.01%

Low modeled failure probability at these inputs. Verify the win rate and payoff ratio are realistic, not optimistic.

edge = (p*b - q) / (p*b + q); RoR = ((1 - edge) / (1 + edge)) ^ (100 / riskPerTrade), where p = winRate/100, q = 1-p, b = payoffRatio
Result report
Compare the result to your written trade plan.
Re-run it whenever your account size, stop, or contract changes.
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Visual model

The tool should change the next decision, not just return a number.

Each tool gives a usable answer on the spot. No account needed.

At a glance
This page
Risk of Ruin Calculator
What you get

Risk of ruin

How to read it

Use the output as a review prompt, not a signal.

  • This normalizes expectancy into an edge between -1 and +1, then applies the classical gambler's-ruin formula raised to the number of risk units in the account (100 / risk%). It reduces to the textbook p-q formula when payoff ratio = 1.
  • Assumptions: independent trade outcomes, fixed % risked per trade of the ORIGINAL capital (not full compounding), and no tail-risk events outside the win/loss model.
  • Zero or negative edge (b*p <= q) means modeled risk of ruin is 100% over a long enough run — position sizing cannot fix a negative-expectancy system.

Risk disclosure

This tool is educational. It does not place trades, recommend trades, or know your personal financial situation. Trading stocks, options, futures and crypto involves substantial risk of loss and is not suitable for everyone. You can lose more than you invest in leveraged products. Only trade money you can afford to lose. Past performance does not guarantee future results.

Methodology

Reviewed as educational research, not trade advice.

Futures-first risk math before product claims.
Every page answers your question before it asks anything of you.
Tools are educational and never produce trade recommendations.
Formulas are shown on the page. Results are educational, never trade recommendations.
Trust file
Author
Sage
Reviewed by
Sage
Updated
2026-05-28
Scope
Education only. Not trade advice.
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Where to go next

The tools are free. The trades are in Pro.

Every calculator and guide here is free, no account needed. If you want to learn the craft, that is the Academy. If you want our trades as we take them, with alerts, that is Pro. New paid memberships are paused right now, so paid plans go through the waitlist.

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