Win rate
The percentage of your trades that finish in profit.
Full explanation
Win rate is simply winning trades divided by total trades. It is the most quoted and least useful statistic in trading when taken on its own.
A 30% win rate is excellent with a three-to-one risk-to-reward ratio and disastrous at one-to-one. A 70% win rate can still lose money if the losers are larger than the winners.
Win rate only means something next to average win size and average loss size — which together give you expectancy.
Why traders watch it
Chasing a high win rate is the reason many traders cut winners early and let losers run. Judging the pair of numbers together avoids that trap.
Trading considerations
- Always report win rate alongside average win and average loss.
- Do not judge it on fewer than about 50 trades.
- A falling win rate with rising expectancy is usually an improvement.
Educational guidance only — never a trading signal or recommendation.
Related indicators
Confirmation
Observable evidence, defined in advance, that a setup is doing what you expected before you commit.
Drawdown
Drawdown is the fall from an account's peak value to its subsequent low, expressed in money or as a percentage. It measures the pain of a losing run rather than the final result. A 20% drawdown needs a 25% gain to recover, and the deeper it goes the harder recovery becomes, which is why controlling drawdown matters more than chasing returns.
Entry
The point at which you open a position — chosen in advance, with a defined trigger and invalidation.
Risk-controlled plan
A plan where the loss on every trade, and for the day as a whole, is decided before the market opens.
Risk-to-reward ratio
The comparison of what you stand to lose against what you stand to gain on a trade, calculated before entry.
Stop loss
A pre-set order that closes a position once price proves the idea wrong, capping the loss.