Profit Factor Calculator
Calculate gross profit divided by gross loss for a set of trades, with net profit, win rate and expectancy.
Profit factor is gross profit divided by gross loss over a set of trades. Above 1.0 the winnings exceeded the losses; below 1.0 they did not, and this profit factor calculator reports where a trading record sits relative to that line.
Formula: profit factor = gross profit ÷ gross loss
Your figures
Enter as a positive amount.
Results
Profit factor
1.67
gross profit ÷ gross loss
- Gross profit
- US$10,000.00
- Gross loss
- US$6,000.00
- Net profit
- +US$4,000.00
- Total trades
- 100
- Win rate
- 40.00%
- Expectancy per trade
- +US$40.00
What this means
A profit factor of 1.67 means the sample produced US$1.67 of gross profit for every US$1.00 of gross loss. Above 1.0 the wins outweighed the losses over this sample. Profit factor summarises past results and carries no information about future trades.
- A high profit factor from a small number of trades is weak evidence. The figure becomes more meaningful as the sample grows.
Profit factor: 1.67
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About the Profit Factor calculation
It is one of the most commonly reported trading system metrics because it summarises a whole sample in a single number, and unlike total profit it is independent of position size and account size.
This calculator derives it from trade counts and averages, alongside the net profit, win rate and expectancy those same numbers imply — figures that are more informative together than the ratio alone.
Profit Factor formula
gross profit = winning trades × average win
gross loss = losing trades × average loss
profit factor = gross profit ÷ gross loss
net profit = gross profit − gross loss
win rate = winning trades ÷ total trades
expectancy = net profit ÷ total trades- gross profit
- Total of all winning trades, before subtracting losses.
- gross loss
- Total of all losing trades, as a positive number.
The profit factor formula is a ratio of totals, which makes it independent of scale. Doubling every trade size leaves it unchanged, so it can be compared across accounts and strategies.
With no losing trades the ratio is undefined rather than infinite, because the denominator is zero. This calculator reports that explicitly instead of showing an infinity symbol.
Expectancy is shown alongside because the two answer different questions. Profit factor asks how the totals compared; expectancy asks what a typical trade produced. A strategy can have a respectable profit factor built almost entirely on one outsized win, which expectancy and the trade count reveal.
Profit Factor: a worked example
A record of 40 winning trades averaging $250 and 60 losing trades averaging $100.
- Gross profit40 × 250 = $10,000
- Gross loss60 × 100 = $6,000
- Profit factor10,000 ÷ 6,000 = 1.67
- Net profit10,000 − 6,000 = $4,000
- Win rate40 ÷ 100 = 40%
- Expectancy4,000 ÷ 100 = $40 per trade
A profit factor of 1.67 means the sample produced $1.67 of gross profit for every $1 of gross loss, despite winning only 40% of the time — the average win was two and a half times the average loss.
How to use the Profit Factor calculator
- Enter the number of winning trades and their average size.
- Enter the number of losing trades and their average size, as a positive amount.
- Include commission and spread in the averages if you want a figure net of costs.
- Read the profit factor alongside the trade count. The same ratio from 20 trades and from 500 carry very different weight.
Limitations of the Profit Factor calculator
Every calculation makes assumptions. These are the ones that matter here.
- Uses averages, so it hides the distribution. A single very large win can lift the ratio while the typical trade loses money.
- Says nothing about drawdown. Two strategies with the same profit factor can have very different worst declines.
- Sensitive to sample size. A high ratio from a handful of trades is weak evidence.
- Describes past results only. A backtest profit factor routinely falls when the same strategy is traded live.
Frequently asked questions about Profit Factor
What profit factor is considered acceptable?
There is no threshold this calculator endorses. Above 1.0 the sample made money; how much above is meaningful depends heavily on the number of trades and on whether costs were included. Very high figures from small samples usually reflect luck or curve-fitting.
What if I have no losing trades?
The ratio is undefined, since dividing by zero has no result. The calculator says so rather than displaying infinity. In practice this almost always means the sample is too small.
How does profit factor relate to expectancy?
Profit factor is a ratio of totals; expectancy is an average per trade. Both are shown here. Profit factor is scale-free and easy to compare; expectancy tells you what one more trade would be worth on the same averages.
Does profit factor account for drawdown?
No. It ignores the order the trades occurred in, and drawdown depends entirely on that order. The maximum drawdown calculator covers this.
Last reviewed . See our methodology and editorial policy.
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