Skip to main content
All CollectionsFAQs
What is “Profit Factor"?
What is “Profit Factor"?

Profit factor is a unique metric used by many of the leading hedge funds.

Updated over 3 weeks ago

Profit Factor is a key metric used by top hedge funds worldwide to assess the effectiveness of a trading strategy and guide investment decisions.

We calculate the Profit Factor by dividing the net PnL (profit and loss) of all positive trades (after accounting for commissions and swap fees) by the net PnL of all negative trades.

To pass a Profit Factor Challenge, you must meet both the required Profit Factor and the winning trade percentage within the specified number of trades.

Did this answer your question?