What counts as ruin in this calculator?

Not zero — a breach of the drawdown threshold you set, such as a funded-account max drawdown or your personal pain level.

Why do two runs give slightly different numbers?

Random sampling noise. Ten thousand runs resolve the headline percentage to about half a percentage point.

How does risk of ruin relate to position sizing?

Risk per trade is the shared dial: the position size calculator turns it into a lot size, and this tool shows what it does to survival odds.

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Risk of Ruin Calculator

What are the odds a strategy with your numbers breaches its drawdown limit before its edge pays off? This runs 10,000 simulated trade sequences in your browser and shows the honest spread of outcomes. The method is printed below the tool — every number is reproducible.

Win rate (%)

Average win (in R, e.g. 1.5 = 1.5× risk)

Risk per trade (% of account)

Trades to simulate

Ruin threshold (max drawdown %)

Risk of ruin

—

runs that touched the drawdown limit

Finished ahead

—

runs ending above starting equity

Median outcome

—

middle run's final equity vs start

Expectancy per trade

—

win% × avg win − loss% × 1 (in R)

Worst losing streak seen

—

across all 10,000 runs

Worst run's drawdown

—

deepest peak-to-trough in the sample

Press the button to run. Runs entirely in your browser — nothing is stored or sent anywhere.

How this works (the whole method)

Each simulation builds a sequence of trades from your inputs: every trade is a win with your win rate and pays your average win (in R, where 1 R = the amount risked), or a loss and costs exactly 1 R. Equity compounds at your risk-per-trade percentage, fixed-fractional. The run "ruins" the moment equity falls your chosen threshold below its peak — the way a real drawdown limit works. Ten thousand runs give the odds; the odds are the answer.

Expectancy first. If expectancy (win% × avg win − loss%) is not above zero, no amount of sizing discipline helps — the simulation will show that as a rising ruin probability and a falling median. Fix the edge before the size.

One arithmetic check you can do by hand

At a 50% win rate, the chance of ten losses in a row at some point during 200 trades is about 1 in 6 — streaks are normal, not signals (each specific 10-loss window has probability 0.5¹⁰ ≈ 0.1%, and 200 trades give ~191 such windows). If your risk percentage makes a ten-loss streak intolerable, the risk is wrong — not the streak. The drawdown glossary entry covers the asymmetry (a 50% loss needs a 100% gain), and the 1% rule covers the sizing side.

Honest limits — read these

Garbage in, gospel out is the danger. The simulation trusts your win rate and average win exactly. Real estimates of those numbers are noisy — run pessimistic inputs too.
It assumes independent trades and a constant edge. Real strategies cluster losses (news weeks, regime shifts). Expect real drawdowns to fatten slightly beyond the model.
It is a planning tool, not a prediction. It answers "what does my own arithmetic imply about risk", nothing more. Education only, never financial advice.

Quick answers — Risk of Ruin Calculator

What counts as "ruin" here?

Not zero — a breach of the drawdown threshold you set. On a funded account, set it to the firm's max-drawdown rule; on a personal account, the pain level at which you would stop trading the strategy.

Why do two runs of the button give slightly different numbers?

Random sampling noise — 10,000 runs resolve the headline percentage to about ±0.5%. If the two answers differ by more than a point, something in the inputs changed.

How does this relate to position sizing?

Risk per trade is the dial between them. The position size calculator turns that dial into a lot size for a given stop; this tool shows what the dial does to survival.

Tools this pairs with

Monte Carlo strategy simulator — equity-curve distribution for a full strategy
Position size calculator — risk % → lot size
Expectancy — the one number that must be positive first
Free trade-log spreadsheet — measure your real win rate and R before trusting it here

Risk warning: Trading foreign exchange and CFDs on margin carries a high level of risk and may not be suitable for all investors. You could sustain a loss of some or all of your initial investment. Education only, never financial advice. Simulation results are estimates from your own inputs, not guarantees.