Expectancy calculator
What is your edge worth per trade — before and after costs?
Take the numbers from your trade log: win rate, average win, average loss, trades a month. Expectancy says what a typical trade is worth. Add your cost per trade and it shows how much of your edge the broker keeps — and what a rebate on the same volume gives back.
Next Carry this win rate and R into the drawdown tool →
Reading the number honestly
- Formulas: expectancy E = p × W − (1 − p) × L; in R, E ÷ L; break-even win rate = L ÷ (W + L); profit factor = p × W ÷ ((1 − p) × L); cost share = c ÷ (E + c). The zero-cost line assumes the cost is the same on winners and losers.
- Expectancy is an average. Twenty trades is not enough to trust it; two hundred starts to be. Recalculate monthly and watch the trend, not the level.
- Recorded wins and losses already include costs. The “zero costs” line shows what the same method would have made with none — that gap is the broker's share of your edge.
- A rebate is paid per lot, win or lose. On a high-frequency method it is a straight addition to expectancy; on five trades a month it barely registers. Profit factor under 1.2 on fewer than a hundred trades is noise, not an edge.
Questions
What is a good expectancy?
Positive, stable over hundreds of trades, and large relative to cost per trade. In R terms anything sustained above 0.2R is a working method; above 0.5R is rare. In money terms it only means something next to your trade frequency.
Profit factor or expectancy — which should I watch?
Both, for different questions. Profit factor (gross wins ÷ gross losses) says how efficient the method is; expectancy says what each trade is worth in money. A profit factor of 1.5 on a method that trades twice a month and one that trades twice a day are very different incomes.
Why does cost per trade matter so much for scalpers?
Because the edge per trade is small and the cost is fixed. A scalper netting 1.5 pips on average with a 1-pip round-turn cost is giving 40% of the gross edge to the broker. The same cost on a 60-pip swing trade is 1.6%. That is why account type and rebate matter most to the highest-frequency traders.
