Metrics glossary

Plain-English definitions of expectancy, R-multiple, and more.

Plain-English definitions for the terms you'll see across the dashboard and reports.

Core metrics

  • Win rate — the percentage of closed trades that were profitable.
  • Expectancy — the average P&L you can expect per trade, blending win rate and average win/loss size. Positive expectancy is the goal.
  • Profit factor — gross profit divided by gross loss. Above 1.0 means you make more than you lose.
  • R-multiple — a trade's result expressed in units of the risk you took (your stop distance). +2R means you made twice what you risked.
  • Reward-to-risk (R:R) — your planned reward divided by planned risk, before the trade.

Risk & equity

  • Drawdown — the drop from an equity peak to a subsequent trough; measures how much pain a strategy puts you through.
  • Equity curve — your cumulative P&L over time.
  • Realized vs. unrealized — realized P&L is locked in on closed quantity; unrealized is the paper gain/loss on what's still open.

The Tools page has calculators (R:R, Kelly, drawdown recovery, risk of ruin) that use these same concepts.

Still stuck? Email us at support@ledgerofalpha.com and we'll help.