MZ Equity Curve Simulator
FINAL BALANCE
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TOTAL RETURN
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EXPECTANCY (R per trade)
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SIMULATED MAX DRAWDOWN
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Why Simulate Your Equity Curve?
Understanding Variance in Trading
Most traders underestimate variance. An equity curve simulator visualizes the "luck factor" in your trading system. Even with a 60% win rate, Monte Carlo simulations show that you will eventually hit a streak of 5–8 losses. Knowing this ahead of time prevents emotional decision-making during drawdowns.
How Expectancy Drives Long-Term Results
Expectancy is the average R you earn per trade. A positive expectancy (e.g. +0.6R) means your system is profitable over enough trades, even with a sub-50% win rate. Combine this with consistent risk management and the equity curve speaks for itself.
Formula: Expectancy = (Win Rate × RR) − (1 − Win Rate)
Max Drawdown and Risk of Ruin
Simulated max drawdown tells you the worst-case scenario your account could face. If your drawdown exceeds your risk tolerance, reduce your risk per trade before going live. A lower risk % means a gentler equity curve and better psychological resilience.
Rule: Keep max drawdown below 20% of your account at 1% risk/trade.