What is it?

Monte Carlo simulation is a statistical method that evaluates the range of possible outcomes of a trading strategy. Rather than relying on a single past performance, it generates thousands of potential "futures" based on your parameters (success rate, risk, etc.). This provides a probabilistic view of the profitability and robustness of your approach. If the blue line (statistical bad luck) remains below the dotted line over the long term, your profitability is not assured.

How do I use this tool?

Fill in the fields in the "Settings" panel to test your strategy:

• Initial capital : Your starting capital.
• Risk per trade (%) : The percentage of your current capital that you risk on each position.
• Success rate (%) : The percentage of winning trades in your history.
• Average gain / Risk factor (R) : Your average profit in multiples of your risk. If on TradingView the profit factor is 2.5, enter 2 here and 1 below.
• Average loss (R) : Your average loss in multiples of your risk. Leave this value at 1 and adjust the average gain.
• Trades : The number of trades to simulate for each scenario.
• Simulations : The total number of scenarios to be generated. A higher number increases the reliability of the statistics.
• Slippage (% per trade) : Estimated transaction costs (fees, price slippage) for each order.

Click on "Run" to view the results. The graph will display the median scenario (P50), as well as the best (P100) and worst (P0) scenarios from the thousands of simulations.