About the Author David E. Chamness is a professional trader with a background in engineering and statistics. Contact him at firstname.lastname@example.org . Minimizing your risk of ruin By David E. Chamness | August 1, 2009 D.R. Cox and H.D. Miller published a simple formula to calculate risk of ruin for insurance companies. Traders can use this formula to calculate the probability of losing any given fraction of their account.