R-multiples and expectancy
You will learn to
- Measure trades in R
- Calculate expectancy
- Include fees
Think in R
R is the amount you risked. A loss at the stop is −1R; a win at a target twice as far is +2R. R lets you compare trades of any size and any market.
Expectancy
expectancy = win% × average win (R) − loss% × average loss (R)
| Win rate | Avg win | Expectancy |
|---|---|---|
| 40% | 2R | +0.20R |
| 70% | 0.5R | +0.05R |
| 55% | 0.7R | −0.07R |
| 30% | 3R | +0.20R |
Win rate alone tells you nothing. Many "80% win rate" systems lose money because the 20% of losses are large.
Fees are part of R
On Binance futures a round trip costs about 0.10–0.12% of the position (taker 0.05% per side plus slippage). With a 0.4% stop that is a quarter of an R gone on every trade before price moves — which is why tight stops on low timeframes so often fail after fees.
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Check yourself
1. 45% win rate, winners +2R, losers −1R. Expectancy before fees?
- +0.35R ✓
- −0.10R
- +0.90R
0.45 × 2 − 0.55 × 1 = 0.35R.
2. Round-trip costs 0.12% and your stop is 0.4% away. Fees per trade in R ≈
- 0.03R
- 0.3R ✓
- 3R
0.12 ÷ 0.4 = 0.3R.
Terms in this lesson
- Expectancy
- Average R per trade: win% × avg win − loss% × avg loss.
- R / R-multiple
- Result measured in units of the amount risked.
- Slippage
- Difference between the expected and the actual fill price.
Practise it on real charts. In the app, this lesson comes with real examples (reveal what happened next), a graded drill and the track test. Open the Academy in NexusCore — free →