The minimum required quantity of profitable trades in the general case



This powerful calculator calculates a minimum quantity of profitable trades you need to have in order to avoid losses. TakeProfit and StopLoss levels are already set. You need to know what will the increasing and decreasing price if the the orders executed takeprofit and stoploss, respectively.

Your leverage: 1: (An integer from 1 to 9999)

The share of deposits in each transaction: % (Larger than 0, up to 100)

What is the change of the amount that is used in the transaction, without taking into account the leverage:

If TakeProfit executed: % (Larger than 0)

If StopLoss executed: % (Larger than 0, up to 100)

 
           
 

When you set your order TakeProfit, you can always calculate on how many percent will increasethe the amount that is used in the transaction, without taking into account the leverage, if the order TakeProfit will execute. Analogously, when you set the order StopLoss, you can always calculate on how many percent will decrease the amount that is used in the transaction, without taking into account the leverage, if the order StopLoss will execute.

If you are using your trading account without a spread, but with the brokerage commission, then, for finding the these change, it is necessary to take into account additional losses due to the commission.

Enter these data into the calculator, together with data for the leverage on the trading account and the share capital, which each time is used for the transaction. Then you get the calculation of the ratio of profitable and losing trades. This ratio is borderline between profitable and unprofitable trading system. If your real trading has this ratio is smaller than from this calculator, then your trading system is unprofitable. If your real trading has this ratio is larger than from this calculator, then your trading system is profitable.

Thus this calculator makes the calculation of the break-even point of your trading system for the general case, when leverage is used in trading, and when a constant part of the deposit is used in each transaction.

For example, suppose that for your trading system is necessary to constantly to set TakeProfit so that it is executed when the price increased by 5%, and it is necessary to constantly to set StopLoss so that it is executed when the price decreases on 10%. And let the you work on a trading account with a leverage 1:10. Moreover, let in every transaction you use only 2% of your money in your account. The calculation of the calculator shows that for your trading system, you will need to deal closed through the TakeProfit no less than 67%. Otherwise, this trading system threatens to ruin you.

Another example. Suppose you want always to install the TakeProfit so that each time it is execution, your money in the deal would have increased by 7% if the leverage 1:1. And you want always to install the StopLoss so that each time it is execution, your money in the transaction have decreased by only 3% if the leverage 1:1. Let your trading account has the leverage 1:100. Let in every transaction you plan to use only 50% of all funds that are in your account. Then the calculation of this calculator shows that enough only one losing transaction in order to loss total your deposit. Moreover, your order StopLoss did not even have time to be fulfilled, as the earlier program software of you broker will make compulsory closing of your transaction with zeroing of all of your deposit.

In the second example, the trading system will be profitable only if all your transactions will be extremely profitable. This trading system is even more worse thing than a roulette in a casino. Because if you bet at the casino 50% of your capital and lose this money, then you have at least remains the other 50%. These remaining 50% you again divide to 2 parts and continue to play. Etc. That is, there is hope that at some stage the player will think again and save at least some of their money.







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Author: Eugene Mironov.

Financial analysis and financial management | © Eugene Mironov; 2008-2019