Risk & Positioning
Risk / Reward Calculator
Compare a finite capital-at-risk amount with a target reward.
About this calculator
How to use this tool
Reward/risk divides the target profit by the loss amount, using a consistent position size and accounting for fees in your inputs. This ratio says nothing about how likely either outcome is.
Use maximum contractual loss only when it is genuinely defined. A stop order, margin deposit or premium collected is not a reliable loss cap for a naked short option.
Worked example
A $200 target against $300 risk gives reward/risk of 0.67 and a 66.67% target return on risk.
Related tools
Model references and conventions
365 calendar days per year. Continuous rates for theoretical pricing. All examples are illustrative.
