What is Trading Expectancy & Expected Value (EV)?
Trading expectancy (Expected Value or EV) is the statistical average dollar or R-multiple amount a trader can expect to make or lose per trade over a large sample size, combining win probability, average win size, loss probability, and average loss size into a single edge metric.
Mathematical Calculation
Where P_win is your historical win rate (0 to 1), W-bar is your average winning trade (in dollars or R), and L-bar is the absolute value of your average losing trade.
Real-World Numerical Simulation
Calculating Expected Value (EV) Per Trade on a $100K Challenge
Win Rate (P_win): 48% (0.48); Loss Rate: 52% (0.52).
Average Win: $450; Average Loss: $210.
Formula: (0.48 × $450) - (0.52 × $210) = $216.00 - $109.20 = +$106.80 Expected Value per trade.
Challenge Projection: To pass a $6,000 profit target, the trader statistically needs ~57 trades ($6,000 ÷ $106.80).
Purple Expected Value (EV) Card & Mistake Cost Audit
Displayed prominently in signature purple on your Performance Analytics Hub, LogToLast computes your live Expected Value (EV) per trade and pairs it with Psychological Leak Analysis—showing what your EV and net profit would be without FOMO or Revenge Trading.
Institutional Comparison Matrix
| Expectancy (in R) | Edge Classification | Expected Outcome Over 100 Trades |
|---|---|---|
| < 0.00R | Negative Expectancy | Mathematically guaranteed account breach as sample size grows |
| +0.05R to +0.15R | Thin Retail Edge | Vulnerable to commission drag and news slippage |
| +0.20R to +0.45R | Robust Prop Firm Edge | Generates +20R to +45R per 100 trades; high payout consistency |
| > +0.50R | Elite Quantitative Edge | Earns 'Holy Grail' System Quality badge in Backtest Lab |
Monitored Prop Firms Applying This Rule
Frequently Asked Questions
Stop Tracking Trading Expectancy & Expected Value (EV) Manually in Spreadsheets
Displayed prominently in signature purple on your Performance Analytics Hub, LogToLast computes your live Expected Value (EV) per trade and pairs it with Psychological Leak Analysis—showing what your EV and net profit would be without FOMO or Revenge Trading. Test our 5-engine trading OS—including 20+ account cloud & MT5 replication, Playbook Active Enforcer, AI Journal, and Native Ctrl+C Backtest Lab—for $0.00 today during your 14-day Elite trial.
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