R-Multiple, Expectancy & Profit Factor: The 3 Stats That Actually Matter

Ask a struggling trader their win rate and they'll know it instantly. Ask their expectancy and you'll get a blank look. That's backwards. Win rate on its own tells you almost nothing — you can win 70% of the time and still go broke. Here are the three numbers that actually matter.

R-multiple: your results on one scale

Ris the amount you risk on a trade. If you risk $100 and make $250, that's a +2.5R trade. Measuring every trade in R strips out account size and position size, so a win on a small account and a win on a big one are directly comparable. Everything below is built on R.

Expectancy: what you make per trade, on average

Expectancy is the average R you can expect per trade. The formula:

Expectancy = (Win% × Average Win in R) − (Loss% × Average Loss in R)

If your expectancy is +0.3R, then over a large number of trades you make about a third of your risk per trade, on average. Positive expectancy means the system makes money over time. Negative means no amount of position sizing will save it. This is the single most important number in trading, and almost nobody tracks it by hand because it's tedious — which is exactly what a journal is for.

Profit factor: gross wins vs gross losses

Profit factor is total profit divided by total loss. A profit factor of 1.0 is breakeven. 1.5is solid. Below 1.0 you're losing money. It's a quick health check on whether your winners are actually paying for your losers.

Why win rate is the trap

A 40% win rate with an average +3R winner and −1R loser is a fantastic system. A 75% win rate where your losers are −5R and winners +1R is a slow-motion account explosion. Win rate without R tells you nothing. Expectancy and profit factor tell you everything.

FundedView computes all three automatically from the trades you log — no spreadsheet formulas required.

Get started with FundedView and log your first trade in under a minute.