Risk reward

[smbtnt]

I am looking for a risk reward calculator that also plots charts of the P+L.

Does anyone know of a free application with the this facility?

 

[TheBramble]

I use Excel.

 

[smbtnt]

I use Excel.

would you mind sharing your formulae? someone had posted this application a while back on t2w, but for the life of me i cannot seem to find it under search...

 

[TheBramble]

?

R:R is the ratio of risk to reward. Nothing more. Incorrectly stated by most, including me, the other way round.

Just divide your risk by your reward and represent it a as ratio. EG Risk is 15c reward is 75c then 15/75 = 1:5, but I tend to use decimals rather than ratios which would make it 0.2. But using it the wrong way round it's 5.0. You're expecting to make 5 times as much as you're planning on risking.

Make sense?

My trading spreadsheet also includes spreads and costs in the risk. I am Ultra cautious...

 

[smbtnt]

It does make sense, thanks bramble. This infamous app also had a win/loss % add-on which allowed you to plot charts of number of trades against capital growth. If I remember correctly it also let you calculate number of units to trade as a percentage of your capital using normalisation coeffecient I think.
Have you come across this or use it in excel?

I am not aufait with excel and would appreciate any help please..

Thanks

 

[TheBramble]

It's been a while since I bothered looking at number of trades and equity curves.

Having your trade size calculated for you is a good thing though. Just make sure it's based on your risk rather than your capital.