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How much should I risk per trade?
Use the Kelly Criterion to estimate the mathematically optimal fraction of capital to risk per trade from your historical win rate and average win vs loss — then see a practical Half Kelly reference. For education only — not financial advice.
Quick answer
Kelly% ≈ W − (1−W) / b, where W is win rate and b is average win ÷ average loss. If Kelly is positive, the simple model says you have an edge; Half Kelly is a common, more conservative fraction for real-world trading.
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Your stats
Use averages from your journal or backtest. Same currency for win and loss.
Result
Enter values and tap “Calculate”.
When should you use this?
- •Estimate the optimal percentage of your account to risk on each trade (under a simple model)
- •Check whether your stats imply a mathematical edge (positive Kelly)
- •Avoid over-sizing positions that can create outsized drawdowns
How it works
- 1
Enter your stats
Input historical win rate, average winning trade, and average losing trade from your trading journal or backtest.
- 2
Apply the Kelly formula
We compute Kelly% = W − (1−W)/b, where W is win rate (as a decimal) and b is average win ÷ average loss. A positive value suggests an edge in this simplified setup.
- 3
Use Half Kelly
Half Kelly keeps much of the theoretical growth benefit with lower path risk. The dollar line shows approximate risk per $10,000 account at Half Kelly.
Example
Inputs: 55% win rate, $200 average win, $100 average loss → b = 2.
Full Kelly: 0.55 − 0.45/2 = 32.5% of capital. Half Kelly: 16.25% → about $1,625 risk on a $10,000 account (illustrative).
Frequently asked questions
The Kelly Criterion is a formula from probability theory that suggests a fraction of capital to risk so that long-run growth is maximized — under strong assumptions (known true probabilities and payoffs, no estimation error, unlimited trials). In trading, those assumptions rarely hold exactly, so practitioners often use a fraction of Kelly.
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Last updated: April 2026
FX13: AI Trading Signals provides free trading tools and educational resources. Kelly sizing depends on stable, well-estimated statistics; real trading adds costs, correlation, and regime change. Not personalized advice. © 2026 Rakhimboy Rozmetov. FX13: AI Trading Signals
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