Profit Factor

Profit Factor – Profit factor is a performance metric equal to total gross profit divided by total gross loss. It’s often included in journal analytics. A profit factor above 1.0 indicates a system makes more money on wins than it loses on losses. Journals like Trademetria and TraderSync calculate profit factor automatically from logged trades. For a robot, profit factor provides a quick gauge of overall effectiveness. For example, a profit factor of 2.0 means the strategy earns twice as much in winners as it loses in losers. This is more informative than net profit alone. Tracking profit factor helps robot developers compare system versions: a code change that raises profit factor suggests an improvement. In trade journals, profit factor is usually reported alongside expectancy and win rate to characterize the system’s edge.

⬅ Robots Glossary