A 70% win rate can still lose money
Win rate only counts trades; the size of your wins and losses decides the result. You break even at 1 ÷ (1 + reward:risk), so a 70% win rate with losses three times your wins is still a losing record.
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Same ten trades, two traders
| Example data | Win rate | Wins | Losses | Result | Per trade |
|---|---|---|---|---|---|
| Trader A | 70% | 7 × +1R | 3 × −3R | −2R | −0.2R |
| Trader B | 40% | 4 × +2.5R | 6 × −1R | +4R | +0.4R |
Trader A: 7 × 1R − 3 × 3R = 7R − 9R = −2R. Trader B: 4 × 2.5R − 6 × 1R = 10R − 6R = +4R. The lower win rate came out ahead because its wins are bigger than its losses.
Example data to show the arithmetic, not a result or a target.
Your break-even win rate
Break-even win rate = 1 ÷ (1 + reward:risk), where reward:risk is your average win divided by your average loss.
| Reward:risk | Break-even win rate |
|---|---|
| 1:1 | 1 ÷ 2 = 50% |
| 2:1 | 1 ÷ 3 ≈ 33% |
| 3:1 | 1 ÷ 4 = 25% |
Trader A wins 1R and loses 3R, a reward:risk of 1:3, so the break-even is 1 ÷ (1 + 1/3) = 75%. A 70% win rate is below it. Trader B's 2.5:1 breaks even at about 29%, well under 40%.
How TJ shows this
- Win rate and average R side by side for any date range, so one never hides the other.
- Expectancy per trade, next to profit factor and net R.
- By Rate It! grade: the same numbers split by the grade you gave the setup before you clicked, so you can see which setups carry your results.
Free for 3 days, then pick a plan. The demo uses example trades; no account needed.
Questions
What is a good win rate in trading?
There isn't one number. A win rate is only good compared with your break-even win rate, which depends on how big your wins are versus your losses: break-even = 1 ÷ (1 + reward:risk). At 2:1 you break even at 33%; at 1:3 you need 75%.
How can a 70% win rate lose money?
When the losses are bigger than the wins. Seven wins of 1R and three losses of 3R add up to −2R over ten trades (example data).
What is expectancy?
The average result per trade in R: win rate × average win − loss rate × average loss. Example: 40% × 2.5R − 60% × 1R = +0.4R per trade.
How many trades do I need before my win rate means anything?
Many more than ten. Small samples swing a lot, so judge a setup on dozens of trades logged the same way, not on one good week.
Journaling software. Not financial advice.