Compounding Calculator
The Traders MBA Compounding Calculator is a free tool designed to help traders understand how their account can grow over time through the power of compounding. By inputting your starting balance, number of trades, risk per trade, reward-to-risk ratio, fees, and optional deposits or withdrawals, the calculator projects your expected results in a clear and realistic way.
Unlike generic finance tools, this calculator is built specifically for trading. It includes professional metrics such as expectancy, break-even win rate, Kelly sizing, and growth per trade, alongside an equity curve chart that updates instantly. Use it to test different trading strategies, plan for consistent withdrawals, and refine your money management approach with confidence.
Disclaimer: This tool is provided for educational purposes only and on an “as is” basis. It does not constitute financial advice. To the maximum extent permitted by UK law, Traders MBA and its contributors disclaim all warranties and accept no liability for any loss, damage or costs arising from use or reliance on the calculator. Always verify results with your broker and conduct your own due diligence.
How to Use the Trading Compounding Calculator
1. Enter your starting balance
Input the amount of trading capital you are beginning with (e.g. £10,000).
2. Set the number of trades
Choose how many trades you want the calculator to project, such as 50, 100, or 500.
3. Define your risk per trade
Enter the percentage of your account balance you are willing to risk on each trade (commonly 1–2%).
4. Add your reward-to-risk ratio
Specify your expected reward compared to your risk (e.g. 2 means you aim to make twice what you risk).
5. Enter your win rate
Provide your estimated percentage of winning trades (e.g. 45%). The calculator uses this to project expectancy and long-term results.
6. Include fees or commissions
Add any broker fees or trading commissions to see their impact on overall returns. Leave at 0 if not applicable.
7. Optional: Add cash flows
You can include regular deposits or withdrawals, either as a fixed value or as a percentage of your account size.
8. Click “Calculate”
The calculator will instantly generate your projections, metrics, and equity curve.
9. Review the results and chart
Analyse the output, which includes final balance, total return, expectancy, Kelly sizing, growth per trade, and estimated trades to double. The chart shows your equity growth over time.
10. Use the Reset button to start over
Quickly clear all inputs and experiment with new trading strategies or parameters.
Disclaimer
This calculator is provided for educational purposes only. It does not constitute financial advice. To the maximum extent permitted under UK law, Traders MBA and its contributors accept no liability for any losses, costs, or damages arising from use of this tool. Always verify results with your broker and conduct your own due diligence.
Frequently Asked Questions
Before using the Trading Compounding Calculator, many traders have similar questions about how compounding works, how to interpret the results, and how to best apply the tool. Below we’ve answered the most common queries to help you get the most value out of this free resource.
This FAQ focuses specifically on trading scenarios, not generic savings calculators, so all answers are tailored to risk management, expectancy, and compounding in active markets.
1. What is a trading compounding calculator?
It’s a tool that projects how your trading account could grow over time based on your risk per trade, win rate, reward-to-risk ratio, and number of trades.
2. Why is compounding important in trading?
Compounding shows how small consistent gains can accumulate into significant account growth, especially when profits are reinvested trade after trade.
3. What inputs do I need to use this calculator?
You’ll need your starting balance, number of trades, risk per trade (%), reward-to-risk ratio, win rate (%), and optionally fees or cash flows.
4. How accurate are the projections?
The results are mathematical projections based on your inputs. Real trading outcomes may differ due to slippage, psychology, and market conditions.
5. What does “geometric expectancy per trade” mean?
It measures the expected growth factor per trade, considering both wins and losses. A positive expectancy means your strategy has long-term growth potential.
6. How are deposits and withdrawals handled?
You can enter regular deposits or withdrawals as a fixed cash value or a percentage of your balance. These are factored into your balance projections and chart.
7. What is the Kelly percentage shown in the results?
Kelly sizing estimates the optimal risk per trade for maximum account growth, though in practice most traders use a fraction of it for safety.
8. What does “break-even win rate” mean?
It’s the minimum win rate you need for your strategy to avoid losses, given your chosen reward-to-risk ratio.
9. Can this calculator be used for day trading, swing trading, or long-term investing?
Yes. The calculator works for any timeframe because it’s based on the number of trades and your performance metrics, not on specific durations.
10. Is this financial advice?
No. This calculator is provided for educational purposes only. Always conduct your own research and risk management before trading.