Risk simulator
How deep can the account fall with your numbers, and what does a higher risk per trade change?
A simulation of random trades with the numbers you enter, not a forecast of your results or advice on position size.
How deep can the account fall with your numbers, and what does a higher risk per trade change?
A simulation of random trades with the numbers you enter, not a forecast of your results or advice on position size.
Enter a win rate, the ratio of the average win to the average loss, the percent of the account you risk per trade and the number of trades. The simulator runs thousands of random sequences with those numbers and reports the typical worst drawdown, the bad case at the 95th percentile, the chance of a drawdown of 20, 30 and 50 percent and the median result of the account.
The table repeats the run for 0.5, 1, 2, 3, 5 and 10 percent risk with the same edge. The same strategy that has a modest drawdown at 1 percent can have a deep one at 5, and the spread between outcomes grows with the risk. That is the practical reason to keep the size fixed.
The model assumes independent trades, a constant win rate and constant reward, a fixed percent of current equity per trade, and no fees or slippage. Real markets have fatter tails and changing regimes, so the drawdowns shown are optimistic. If the expectancy per trade is not positive, the page says so: a bigger risk then only speeds up losing.
It depends on the win rate, the reward and the number of trades. Enter your numbers; the table shows several risk levels side by side.
Yes. After you log at least 20 trades with wins and losses, one button fills the win rate and the ratio of the average win to the average loss.