Version 1.5 of Risk/Reward submitted to App Store
Version 1.5 of Risk/Reward has been submitted to is now available on the App Store. This version now calculates results to 3 decimal places, so that you can enter a value like .009 for Share Price and .001 for Max Loss/Share. This functionality was recommended by a Risk/Reward user as it would help with penny stocks.
Screenshot is below.
The Risk/Reward R Calculation
Someone recently purchased Risk/Reward (thank you!) and had a concern about the cost of trade in relation to gains. With his permission, this is the email be sent me:
I just downloaded the app and noticed that “cost of trade” ( assume to
be commission expence) works correctly for loss on sales where stock
price goes down, however it appears to be additive on gains (profit)
when stock price goes up. I would have expected the cost of trade to
always reduce the return; increase losses and reduce gains. Will this
calculation be revised in future app release?
So, let’s take a look at what a calculation looks like. With an upcoming version of Risk/Reward you will be able to email yourself the results, so let’s use that feature for this. We’ll take a simple position so that the math is easy to see:
Risk/Reward Results (2009-9-27 10:44 AM)
Trading Parameters
Share Price: 10.00
Max Loss/Share: $1.00
Number of Shares: 100
Cost To Trade: $10.00
Type of Trade: Long
Risk (1R)
R Sell Price Loss
1R 9.00 110.00
Reward (nR)
R Sell Price Profit
1R 11.10 110.00
2R 12.20 220.00
3R 13.30 330.00
4R 14.40 440.00
5R 15.50 550.00
6R 16.60 660.00
7R 17.70 770.00
8R 18.80 880.00
9R 19.90 990.00
10R 21.00 1100.00
In the trade above, the cost of the trade was $110.00, so this is the 1R. Cost of trade, or, as Van K. Tharp calls “The cost-of-trading opportunity”, includes commissions (to buy and sell), execution costs (slippage, i.e., you never get the exact price you want), taxes, and psychological costs. So, altogether, for this trade, you are risking $110.00 (1R). In order to realize a profit of 1R (again, $110.00), you would have to exit at $11.10. To gain 2R, or $220.00, you would have to exit at $12.20, and so on. The R-value is a multiple (i.e., straight multiplication) of the risk.
If this calculation does not match up with your take on the R-multiple risk for a trade, please let me know, either by commenting below, or sending me an email: lucasrockwell at lucasrockwell.com.
500 Risk/Reward Apps Sold
As of yesterday, 5/16, I have sold 500 Risk/Reward apps! This is certainly beyond my wildest dreams. My original goal was to just recoup the $100 I had to pay to become part of the iPhone developer program, and that happened about 2 months ago. Of course, I am still waiting to be paid by Apple, but I’m sure that will happen any day now. :-)
I am working on a new update to Risk/Reward — the ability to save your calculations. This update should be out around mid to late June.
Thanks to everyone who has purchased Risk/Reward!
Risk/Reward 1.2 Out
Risk/Reward is now available on the App Store. The new version has been updated as follows:
With version 1.2, Buy Price has been changed to Share Price, as share price is more accurate, especially when short selling. Thank you to a very loyal Risk/Reward user for suggesting this change!
Also new in 1.2, the app now remembers the last value for Cost To Trade, as this cost is most likely to stay the same from trade to trade. This way you do not have to enter this value each time you use the application. Once you enter a value in Cost To Trade, it stays at that value until it is changed.
Version 1.3 will be out in the next few weeks, and this version will allow you to shake the phone (if you have an iPhone) to clear the input screen.
Risk/Reward Listed On Yappler
Check out Risk/Reward on Yappler, which is a web-based collection of all the apps on the App Store.
Please Provide Feedback For Risk/Reward
If you have purchased Risk/Reward, first I would like to say THANK YOU! I really appreciate all of the people (well over 300 at this point) who have purchased the app!!!
Second, if you would put a comment on the App Store that would be great. Of course, positive comments are most appreciated :-), but any feedback would be welcome. I think if more people comment, the more newcomers would see that the app is actually used by other people, which would be a huge benefit to the app’s exposure.
Again, thanks!
Risk/Reward 1.1 Almost Out
Risk/Reward 1.1 is currently being reviewed by Apple and should be available by the end of the week.
This version allows you to do the calculation for a long or short purchase. The interface has been updated with two new buttons — “Calc: Short” and “Calc: Long” — which replace the one “Calculate” button. See the screenshot for the example.
You can do one calculation, then go back and do the other if you want. I debated putting the results for both on the results page, but thought it would be too cluttered, so I opted for the two button option.
The next version (1.2), which will be out in another few weeks, will have a preferences section where you can save default values for any of the fields.
iPhone App Support
If you need help with the iPhone/iPod Touch application Risk/Reward (which was made by Lucas Rockwell) please send email to:
iphone-support@lucasrockwell.com
You can also send general comments/suggestions/praise/etc., to that address as well. And again, thanks for purchasing Risk/Reward!
About Risk/Reward iPhone App
RiskReward is an financial application for your iPhone and/or iPod Touch that allows you to calculate how much risk you are taking when you buy a stock using a trailing stop. You enter a buy price, trailing stop, number of shares, and cost to trade (buy and sell), and the app calculates how much you will lose if the price goes down to your trailing stop (1R risk), and then how much you will gain if the price goes up 1 – 10 times the amount of the trailing stop (1R – 10R profit).
Even though the current market is going “sideways”, there is still a lot of money to be made in the stock market. However, you have to be smart about your stock picks, and using a trailing stop and knowing the risk and potential reward of each trade is essential if you are going to be successful.
This app was inspired by Van K. Tharp’s Book, Trade Your Way to Financial Freedom
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