Win Rate
Category
Performance-Analyse & Journaling
Sub-category
Performance-Kennzahlen
Curated by
Last reviewed
The win rate is the share of winning trades among all trades of a strategy. 55 winners out of 100 trades yield a 55 % win rate. Alone the metric says little: only combined with the risk-reward ratio does a picture emerge – a strategy with a 40 % win rate can be more profitable than one with 70 % if the wins are large enough.
Context & Mechanics
Definition and calculation
The win rate is the simplest journal metric: winning trades ÷ total trades × 100. 55 winners in 100 trades yield a 55 % win rate. Psychologically it is the most present number – and that is exactly its danger, because it says nothing about how much is won and lost.
Why the win rate alone deceives
Profitability arises from the interplay of win rate and risk-reward ratio. Two examples with $1,000 risk per trade: strategy A wins 55 % of trades averaging $1,500 and loses 45 % averaging $1,000 → expectancy +$375. Strategy B wins 70 % of trades averaging $500 but loses 30 % averaging $1,500 → expectancy −$100. The "worse" hit rate wins. Conversely, trend-following strategies with 35–40 % win rates can be highly profitable when single winners earn multiples of the risk.
The minimum win rate
A break-even formula follows from the risk-reward ratio: minimum win rate = 1 ÷ (1 + RRR). At an RRR of 1.5 the break-even threshold is 40 %, at 2 it is 33.3 %, at 3 it is 25 %. Comparing the real win rate in the journal against this threshold immediately shows whether a strategy carries – before costs, mind you.
Why it matters for traders
The win rate becomes dangerous when it turns into an end in itself: letting losers run or setting wide stops to embellish the ratio trades metric cosmetics for real risk – an expensive trade in prop-firm rulebooks with a daily loss limit. The GlanWick journal evaluates the win rate automatically per setup and compares it against the minimum threshold – GlanWick is a training and simulation tool and not a prop firm itself.
Execution Example
A trader compares two strategies in the journal across 100 trades each on a $100,000 account ($1,000 risk per trade): strategy A with a 55 % win rate ($1,500 average win, $1,000 average loss), strategy B with a 70 % win rate ($500 average win, $1,500 average loss).
- Strategy A: 55 × $1,500 − 45 × $1,000 = +$37,500 across 100 trades.
- Strategy B: 70 × $500 − 30 × $1,500 = −$10,000 across 100 trades – despite the higher win rate.
- Break-even check: strategy A has an RRR of 1.5 → minimum win rate 40 %; the real 55 % sits comfortably above.
- Consequence: the win rate is only assessed paired with the RRR; strategy B would need a win rate above 75 % at its RRR of 0.33 to be profitable at all.
Execution Risk & Errors
Treating the win rate as the sole quality yardstick
Setting wide stops or sitting out losers to embellish the ratio
Not knowing the minimum win rate for one's own RRR
Comparing win rates of different strategies without looking at the RRR
Interpreting small samples as a stable hit rate
Frequently Asked
What is a good win rate?
There is no universally good ratio – the combination with the risk-reward ratio is decisive. 40 % can be highly profitable, 70 % loss-making.
How do I calculate the minimum win rate?
With the formula 1 ÷ (1 + RRR). At a risk-reward ratio of 2 the break-even threshold is 33.3 %, at 1.5 it is 40 % – before costs in each case.
Why does a high win rate feel better although it guarantees nothing?
Frequent small wins reward psychologically more than rare large ones. That is exactly why many traders drift unconsciously into high-ratio strategies with a poor RRR.
Where do I see my win rate per setup?
In any structured journal. The GlanWick journal calculates win rate, RRR and expectancy automatically per setup tag.