Avg losing trade

The mean loss generated by all unsuccessful positions within the strategy. This metric represents the average amount of capital at risk during a typical losing trade.

Exclusions: This value is calculated using realized losses only. It does not include currently open positions or any trades that ended in a profit or at break-even.

Strategic value: Managing the size of the Average losing trade is the most direct way to control total risk. If this number is significantly larger than your Avg winning trade, the strategy may require an exceptionally high Win rate to remain profitable.

Calculation Formula

The average is determined by dividing the total loss from all losers by the number of losing trades.