Average Loss
Definition Average Loss is the mean amount lost on your losing trades. It provides insight into the typical downside when trades don’t go as planned. Formula Add up all the losses from your losing trades and divide by the number…
Category Education
Average Win
Definition Average Win represents the mean profit amount from your winning trades. It helps you understand the typical gain when a trade is successful. Formula Add up all the profits from your winning trades and divide by the number of…
Win/Loss Ratio
Definition The Win/Loss Ratio compares the number of winning trades to losing trades. It provides insight into the balance between successful and unsuccessful trades, offering a snapshot of trading effectiveness. Formula Divide the total number of winning trades by the…
Win Rate
Definition The Win Rate is the percentage of your trades that result in a profit over a specific period. It answers the basic question: “Out of all my trades, how many did I win?” Formula To calculate your win rate,…
What is Profit Factor?
Profit Factor is the ratio of your total profits to your total losses. It’s a quick and easy way to see if you’re making more than you’re losing. For instance, if your Profit Factor is 2.0, it means you’re making…
Synthetic Covered Call
A synthetic covered call is an options strategy aimed to mimic the benefits of a traditional covered call, but without actually owning the underlying stock. It’s created by selling a put option, which generates income and can also be called a naked put.…