i What this calculator does
Traders count profit and loss and almost never count hours. This calculator does both. Enter the hours a week you spend at the screen, preparing, journaling and learning, the net result for a period, and what your time earns in your job, and it returns your real hourly rate as a trader, the annual hours the activity consumes, and the opportunity cost of those hours.
The result is often uncomfortable and always useful. A profitable year that works out to R40 an hour is a fine hobby and a poor business; the question is which one you think you are running. It pairs with the article on how much time trading actually requires.
This calculator is for educational purposes only. Results are estimates and may vary depending on market conditions, spreads, commissions, platform settings, and exchange rates. It should not be considered financial advice.
Why count the preparation hours
Most traders who do this sum count only the hours with a position open. That flatters the number by half. Reviewing charts, reading the economic calendar, journaling trades, watching educational content and maintaining a watchlist are all hours the activity takes from the rest of your life, and a business would count them. The split between screen and preparation is reported separately because a high preparation share is normal, and healthy, in the first years.
What "your alternative" should be
For an employee, divide the monthly salary by about 173 working hours. For a freelancer or a business owner, use the rate an extra hour of work would actually bring in. If the honest answer is that the alternative is leisure rather than paid work, enter a low number and read the result as a comparison with a paid hobby. The comparison is the point: trading is competing for the same hours as everything else you could do with them.
What to do with the result
A rate well below the alternative with a profit is the common case, and it does not mean stop. It means the activity is currently education with a positive result, and the hours should be weighted towards learning until the edge grows. A rate above the alternative is the signal to look at the account size that would let the activity scale. A loss over a full year after real effort is the signal to read the readiness checklist.
Spotted an outdated figure? If a rate, limit or formula in this calculator no longer matches its source, email us the page and the source. A material correction is dated on the Updates Log.
Frequently asked questions
My result is negative. Is the hourly rate meaningful?
It tells you the hours were an unpaid apprenticeship. That is normal in the first year or two; what matters is whether the share of hours spent learning is high and whether the result is improving year on year.
Should I include the time I spend reading about markets for interest?
If you would not do it without trading, yes. If you would read it anyway, leave it out. The test is whether the hour would exist without the activity.
Why 173 hours for a monthly salary?
A 40-hour week over 52 weeks is 2,080 hours a year, or about 173 a month. Use your actual contracted hours if they differ.
Does the calculator include the risk I am taking?
No. A salary is close to certain; a trading result is not. Two activities with the same hourly rate are not equal when one of them can produce a negative year. The risk of ruin calculator covers that side.
Why scale a short period to a year?
So that a good quarter is not mistaken for a business. If you only have three months of results, the annualised figure is a projection and should be read as one.
What hourly rate makes trading "worth it"?
There is no threshold. The useful comparisons are with your own alternative rate and with your own result a year ago. Rising is the signal; the absolute level only matters if you plan to live on it.
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