Expectancy lab · Four numbers

Day Trading Income Calculator

Four inputs. Your trading expectancy, in dollars.

250-day modelHow it works
01 · Scenario inputs

Your trading profile

Your daily average. Fractional values are fine.

The percentage of trades that finish as winners.

Average win ÷ average loss. 2× means wins are twice as large.

Dollar risk, treated here as the average loss on a losing trade.

Try the video examples

A note on the name: the video calls average win ÷ average loss a “Sharpe ratio”. Here it is labelled win/loss ratio. The standard Sharpe ratio compares excess returns with volatility. Definition ↗

03 · Read the edge

Where does the math break even?

Your win rate 50%Break-even win rate 33.3%

With a 2× win/loss ratio, 33.3% wins offsets the losses before costs. More trades or more risk scales the result; it does not change this threshold.

Keep the market in the picture

The numbers are assumptions.

James’s point is that opportunities and follow-through change with the market. More risk can also change how you trade, so the other inputs may not stay the same.

This model assumes each losing trade loses the entered risk. It uses a fixed 250-day year with no compounding, fees, slippage or taxes. It is an educational estimate, not a forecast or financial advice.

Plan the share size for your risk
Original source · James Rich Young

The four-number video source