Risk management calculator for binary options
The single most profitable calculator on this site: it tells you the largest stake you can place without turning a normal losing streak into a dead account.
Find your safe stake, check if your edge is real, and see how likely a blow-up is.
Kelly is the mathematically fastest growth rate — and it is brutally volatile. Serious traders bet half of it or less. If Kelly says 0%, your edge does not justify any stake.
What the risk management calculator does
Almost every blown binary options account has the same cause, and it is not bad signals — it is stake size. A trader with a genuine 58% win rate still loses the account if a normal 6-loss streak arrives while they are risking 15% a trade.
This calculator takes your balance, risk appetite, payout and win rate and returns the safe stake, the daily stop, and the modelled probability of ruin over a given number of trades. Those three numbers are the whole of risk management.
Once you have the stake, the discipline is boring: never raise it mid-session, never double after a loss unless the ladder is pre-planned, and stop at the daily limit even when the setup looks perfect.
The formula, explained
Stake = Balance × RiskPerTrade% · DailyStop = Balance × MaxDailyLoss%
- RiskPerTrade%
- — 1–3% for most traders; 5%+ is aggressive on binaries because a loss is total
- MaxDailyLoss%
- — typically 3x your per-trade risk, so three bad trades end the day
- Probability of ruin
- — modelled from your win rate, payout and stake fraction across N trades
On binary options the entire stake is lost on a losing trade — there is no stop-loss that recovers part of it. That makes per-trade risk on binaries roughly equivalent to a full-loss forex position, so size it lower than you would on a spot trade.
A real set of numbers
| Risk per trade | Stake | Daily stop | Trades to ruin (6-loss streak) | Modelled ruin risk |
|---|---|---|---|---|
| 1% | $10 | $30 | survives 30+ | under 1% |
| 2% | $20 | $60 | survives 20+ | about 2% |
| 5% | $50 | $150 | survives 8 | about 14% |
| 10% | $100 | $300 | survives 4 | about 46% |
| 20% | $200 | $600 | survives 2 | over 80% |
Same edge, same signals, same market. The only variable is stake size — and it moves the chance of losing everything from under 1% to over 80%.
When to use it — and when not to
Use it when
- Before your first trade of the day, to set the stake and the stop.
- After a deposit or a withdrawal, because both change the correct stake.
- When you are tempted to 'make it back' — check what the bigger stake does to ruin risk.
- When comparing a high-payout asset against a lower-payout one.
Don't rely on it when
- You intend to override the output. A risk limit you ignore is worse than none, because it builds the habit.
- Your win rate input is a guess rather than logged data — use the journal first.
Risk management calculator questions, answered
+What percentage should I risk per trade on binary options?
1–2% of the account. Because a binary loss is a 100% loss of the stake, a 2% binary risk is comparable to a fairly aggressive forex position. Professionals almost never exceed 3%.
+What is a sensible daily loss limit?
Three consecutive full losses. If you risk 2% a trade, stop at 6% down for the day. The purpose is not the money — it is to stop you trading emotionally after a bad run.
+Does risk of ruin apply if I only trade signals?
Yes. Signals change your win rate, not the arithmetic of streaks. A 62% win rate still produces 5-loss streaks regularly across a few hundred trades.
+Should I risk more on high-confidence signals?
A modest increase (say 2% to 3%) on top-tier setups is defensible if your logged data shows those setups genuinely win more. Doubling or tripling is not.
Put the numbers to work
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