Expectancy is formula used to measure the quality of a strategy. Your winning percentage doesn’t give you a complete picture of how well a strategy works. You may have a high winning percentage, but if your losses outweigh your wins, you don’t have a winning strategy. With expectancy, you could have a low winning percentage, but because your wins outweigh your losses, you can still have positive expectancy and a winning strategy. The value tells you what percentage of every dollar risked you can expect to realize. Don’t confuse the risk amount with the cost of the trade. The amount you risk is determined by your position sizing. If your trade should stop out, then the risk is the maximum amount you stand to lose on the trade.