What is Win rate?
Win rate is the share of closed trades that finished in profit, calculated as winning trades divided by the total number of trades taken.
What does Win rate mean in practice?
It is the most quoted statistic in trading and one of the least informative on its own. A strategy can win 80% of its trades and still lose money if the losses are much larger than the wins, and a strategy winning 30% can be profitable if its winners are large enough.
Win rate only means something alongside the average win and average loss, which together with it determine expectancy. It also needs enough trades behind it: a high win rate over a handful of trades is indistinguishable from luck.
A worked example
Illustrative only: 10 trades, 8 winners averaging 100 and 2 losers averaging 600. The win rate is 80%, but the total is 800 minus 1,200, a loss of 400.
How to read or test it
Never read it alone. Pair it with the average win and average loss and compute expectancy, then check how many trades the percentage is based on. Look at it over different periods: a win rate that varies wildly between months suggests the sample is too small or the edge is unstable. If your win rate is very high, check the loss size, and if it is low, check that the winners are large enough to cover the losers.
How AKQX handles Win rate
AKQX reports win rate in the algo scorecard together with net result and trade count, and pairs it with expectancy, profit factor and average win and loss so it is never read alone.
See Backtesting with fees and slippage for the feature page.
A common mistake
Chasing a high win rate. Strategies that win often by taking tiny profits and holding big losers are common and fragile.
Educational only. This entry explains a term. It is not investment advice and does not recommend any trade, setting or strategy, and example numbers are illustrative, not results.
Related terms
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