What Is Maximum Favorable Excursion (MFE)?

Maximum Favorable Excursion (MFE) is the best unrealised profit a trade reached while it was open — the furthest it ran in your favour before you exited. Measured in R, it is the mirror image of MAE: MAE is the heat, MFE is the opportunity.

Why it matters

The gap between a trade's MFE and where you actually closed is profit you saw but did not keep. A trade that peaked at +3R and closed at +1R left 2R behind. Do that repeatedly and your exits, not your entries, are capping your results.

A worked example

Trade	MFE (peak)	Exit	Left behind
A	+3.0R	+1.0R	2.0R
B	+1.2R	+1.0R	0.2R
C	+2.5R	+2.3R	0.2R

Trade A captured only a third of its move. If that is a habit, the fix is in how you exit, not how you enter.

What the patterns tell you

• Winners with high MFE but small exits — you are cutting profits early; consider a trailing stop or a partial-exit plan.
• Losers with high MFE — trades that were nicely green turned red. A break-even stop after a set gain could rescue some of them.
• Exits close to MFE — your exit discipline is strong; you are keeping most of what the market offers.

How to use it

Track MFE and MAE together. Adverse excursion tunes your stops; favourable excursion tunes your targets. Between them they describe the whole life of a trade, not just its final number.

How Tracktions tracks MFE

Tracktions automatically computes MFE from your closed trades — no manual entry needed. Once you import or log trades, MFE updates in real time on the Trades view.

See it in Tracktions →