Glossary › profit factor
Trading glossary · advanced
profit factor
Total money won divided by total money lost. Above 1 means the wins were bigger than the losses overall.
The fuller meaning
Gross profit divided by gross loss over a set of trades. Above 1 the method made money; it is reviewed with expectancy, win rate, average win and loss and maximum drawdown, and compared between forward test and backtest.
profit factor.
Related words
at the money · backtest · backwardation · basis · call option · contango · data snooping · delta · edge · entry trigger