What is profit factor in trading, and what is a good one?
Updated Nov 7, 2026 · 3 min read
Profit factor is gross profit divided by gross loss. Formula, what a good profit factor is, and the profit factor of 475 Hyperliquid traders by account size.
What is profit factor? Profit factor is the money a trader made on winning trades divided by the money lost on losing trades, over the same period. Above 1.0 the trading made money before anything else; below 1.0 it lost money. A profit factor of 1.5 means $1.50 won for every $1 lost.
Key takeaways
- Profit factor = gross profit ÷ gross loss. Count fees, or the number flatters you.
- It ignores how often you win. A 30% win rate can have a high profit factor if the winners are large.
- It needs a decent sample. Ten trades can show almost any number.
- It says nothing about how deep the losing stretches were. Read it with max drawdown.
Profit factor of Hyperliquid traders by account size
Senpi’s Quant Desk scored 475 Hyperliquid accounts across seven size bands over the 90 days to Oct 12, 2026, in a published report. The median account won about half its trades in every band. What differed was profit factor.
| Account size | Median win rate | Median profit factor |
|---|---|---|
| $5k–10k | 50% | 0.86 |
| $10k–25k | 51% | 1.04 |
| $25k–50k | 52% | 1.35 |
| $50k–100k | 50% | 1.41 |
| $100k–500k | 53% | 1.47 |
| $500k–1M | 50% | 0.90 |
| $1M+ | 56% | 1.74 |
The win rate barely moves from the smallest band to the largest; profit factor almost doubles. In that report the larger accounts did not pick better trades. They lost less on the losing ones: smaller positions relative to their usual winner, and lower fees per trade.
How to work out your profit factor
- 01Take every closed trade in the period, including the fees each one paid.
- 02Add up the net result of the winners: that is gross profit.
- 03Add up the net result of the losers as a positive number: that is gross loss.
- 04Divide gross profit by gross loss.
Example: 20 trades, 9 winners making $4,500 in total and 11 losers losing $3,000. Profit factor = 4,500 ÷ 3,000 = 1.5, even though more than half the trades lost.
Raising profit factor
- Cap the size of any one trade relative to your usual winner, so one oversized loser cannot erase a week.
- Lock part of the peak with a trailing stop, so winners stay winners.
- Rest orders instead of crossing the spread where you can: maker fees on Hyperliquid are a third of taker fees.
- Check your own numbers. Paste any Hyperliquid address into Senpi to see its win rate, profit factor and the leaks priced in dollars.
What is a good profit factor?
Above 1.0 is profitable before costs you left out; many traders treat 1.5 or more over a large sample as solid and above 2.0 as strong. In Senpi’s Oct 2026 sample of 475 Hyperliquid accounts, the median ran from 0.86 in the $5k–10k band to 1.74 above $1M.
How do you calculate profit factor?
Divide the total of all winning trades by the total of all losing trades, both net of fees, over the same period.
Can profit factor be high with a low win rate?
Yes. If winners are much larger than losers, a 30% or 40% win rate can still give a profit factor above 2. Trend-following systems often look like this.
What is the difference between profit factor and win rate?
Win rate counts how often you win. Profit factor weighs how much: it compares the money made on winners with the money lost on losers. Two traders with the same 50% win rate can have profit factors of 0.8 and 1.8.
See your own profit factor
Paste any Hyperliquid address into Senpi to see its win rate, profit factor and where it leaks.
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