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Risk of Ruin Calculator
A positive edge is not enough if your bets are too big. See the odds a normal losing streak drops your account past the point of no return, and how much safer a smaller position size makes you.
Risk of ruin is the probability that a losing streak drops your account below a level you could not recover from, before your edge has time to play out. Even a profitable strategy can go bust if the bets are too large.
How it works
Enter your edge, how much you risk per trade and what counts as ruin, then Calculate. The tool simulates thousands of runs, reports your current risk of ruin, and plots how it changes as you size up or down.
Your edge & risk
Why survival comes before returns
The curve is steep: doubling your risk per trade can multiply your risk of ruin many times over. You cannot compound an edge you have blown up, so keeping ruin near zero matters more than squeezing out extra return. The safe position size is usually far smaller than traders expect.
Frequently asked
What risk of ruin is acceptable?
Most professionals keep it close to zero. Anything above a few percent means a single bad streak can end you, which almost always points to risking too much per trade.
How do I lower my risk of ruin?
The fastest lever is risking less per trade. A better win rate or reward to risk helps too, but position size has the biggest and most immediate effect.
Set position sizing and risk limits once, across the whole strategy. Build and backtest it, no code.
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