← THE CHARTSPOD LEDGEROPEN TERMINAL →
RISK · RISK-REWARD RATIO

Risk-Reward Ratios: A Worked Crypto Example With Fees Included

A 2:1 setup on the chart is not 2:1 in your account. Fees on both sides and slippage on the stop shrink the reward and enlarge the risk.

By ChartsPod Editorial Team · Reviewed by ChartsPod Research
Published · Updated · 5 min read

Short answer

Risk-reward compares distance to target with distance to stop. A long 1 BTC at $60,000 with stop $59,400 and target $61,200 is nominally 2:1 ($1,200 vs $600). After 0.05% taker fees on each fill and $20 of stop slippage, the win nets ≈ $1,139 and the loss costs ≈ $680, so the effective ratio is ≈ 1.68:1. Use the effective ratio for planning and for break-even win-rate calculations.

Worked example

StepValue
Entry / stop / target$60,000 / $59,400 / $61,200
Nominal R:R2.0 : 1
Win: $1,200 − fees $60.60≈ $1,139
Loss: $600 + fees $59.70 + slip $20≈ $680
Effective R:R≈ 1.68 : 1
Nominal vs effective risk-rewardNominal vs effective risk-reward: Nominal 2.00 :1; After costs 1.68 :1.NOMINAL VS EFFECTIVE RISK-REWARDNominal2.00 :1After costs1.68 :1
Costs compress every ratio; small targets most. Original ChartsPod editorial graphic.

Where costs bite hardest

Fees are a share of notional, so they are the same dollar amount on a tight setup as on a wide one. On a $120 target and $60 stop, the same $60 fees halve the reward. Short-term setups need wide enough targets to survive costs.

Same fees, different setupsSame fees, different setups. Left, Wide (600 / 1,200): Fees ≈ 5% of reward; R:R 2.0 → 1.68. Right, Tight (60 / 120): Fees ≈ 50% of reward; R:R collapses.WIDE (600 / 1,200)Fees ≈ 5% of rewardR:R 2.0 → 1.68TIGHT (60 / 120)Fees ≈ 50% of rewardR:R collapses
Tight setups lose most to costs. Original ChartsPod editorial graphic.

Conclusion

Related: Break-Even Win Rates: A Worked Crypto Example With Fees Included, Trading Expectancy: A Worked Crypto Example With Fees Included.

Plan the same calculation with ChartsPod's position planner.

Open the ChartsPod terminal

Risk-reward compares distance to target with distance to stop.

Review Risk-Reward Ratios with bar replay before using it live.

Open ChartsPod replay

Questions readers ask

Does R:R include fees?

Nominal ratios don't; effective ones should.

Why add slippage to the stop?

Stops fill as market orders.

Which setups suffer most?

Tight ones.

Sources and methodology

Arithmetic uses standard sizing formulas. Fee rates (0.05% taker, 0.02% maker), slippage and funding values are illustrative; check your venue's schedule. Liquidation figures are simplified approximations; exchanges calculate them with their own maintenance-margin rules (see Bybit's documentation).

  1. Bybit: Liquidation process — mark price and margin modes.
  2. ChartsPod: product overview, pricing and FAQ — free terminal, venues, modules, no order placement; checked 17 Oct 2026.

This article explains research tools and workflows. It is not financial advice, does not recommend buying or selling any asset and does not predict prices. Crypto derivatives carry a risk of rapid and total loss of margin.

CHARTSPOD EDITORIAL EDITION · RESEARCH AND EDUCATION ONLY · NOT FINANCIAL ADVICE.