Trading Expectancy Calculator
Find out if your strategy makes money in the long run — even before you place a single real trade.
Expectancy tells you the average amount you make or lose per trade over a large sample. It is the single best measure of whether a strategy has edge.
Profit Factor = (Win Rate × Avg Win) ÷ (Loss Rate × Avg Loss)
A positive expectancy means the strategy makes money long term. Profit Factor above 1.5 is good. Above 2.0 is excellent. Below 1.0 means you are losing money systematically.
Key insight: You can have a 35% win rate and still be profitable if your average win is large enough. This is why position sizing and letting winners run matters more than being right most of the time.
Trading Expectancy is the single number that tells you whether your trading strategy makes money over the long term. It calculates the average rupee amount you expect to win or lose per trade based on your historical win rate, average winning trade size, and average losing trade size. Positive expectancy means the strategy has mathematical edge. Negative expectancy means it will lose money regardless of how good any individual trade looks. Most retail traders on NSE evaluate their strategy by looking at recent trades — celebrating winning streaks and panicking during losing streaks. This is the wrong approach. A strategy with positive expectancy will have losing periods (drawdowns) even when it is working correctly. Trading expectancy provides the mathematical framework to evaluate a strategy objectively over hundreds of trades. Professional traders and fund managers use expectancy alongside Profit Factor to decide which strategies to run, which to discard, and how to allocate capital across multiple strategies. Before going live with any NSE strategy, calculate its expectancy from at least 50 historical trades in the Momentum IQ backtester.