Part 5 · Measure honestly

16A one-to-one target still needs an edge

With equal wins and losses, costs decide a lot.

With equal gross wins and losses, a 1R target needs a win rate above 50% before costs.

Net = (win fraction × average net win) − (loss fraction × average net loss).

Constructed example (not a backtest): winners +46, losers −46 before costs; with a two-pip cost the net outcomes are +44 and −48. Over a hypothetical 20 trades: 11 winners × 44 = +484; 9 losers × 48 = −432; net +52 pips, +2.6 per trade. Break-even win fraction = 48 / (44 + 48) = 52.17%.

Constructed 20-trade example.

111 winners × 44 = +484; 9 losers × 48 = −432.
2Net +52 pips, +2.6 per trade. Break-even win fraction 52.17%.

Hypothetical illustration, not real market data.

Tool · Break-even and expectancy

Does the arithmetic add up?

Hypothetical win rate (%)Average net win (pips)Average net loss (pips)

Break-even win rate 52.17% · Net expectancy 2.6 pips per trade. Arithmetic, not a forecast.

Tool · Equity-curve simulator

100 random trades from $10,000

Win rate (%)Reward-to-riskRisk per trade (%)

$10,097.35

Ending equity

1.5%

Max drawdown

Longest losing run

Simulation for learning, not a prediction. Even a good plan has long losing streaks.

What else belongs in the report

Maximum and longest losing run
Holding time
Missed fills and expired setups
Rule violations
Results by market condition

Honest note

This example does not estimate real results. Compare trades in net money and R-multiples.

Key takeaway

Above 52.17% wins is needed just to break even in this constructed case.

Try it

Run the simulator five times at 50% and note the longest losing run each time.

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