#RiskRewardRatio
The risk-reward ratio compares the potential profit of a trade or investment to its potential loss. It's calculated by dividing the amount at risk by the net profit expected. A lower ratio (e.g., 1:2) suggests a higher potential reward relative to the risk, which is generally more favorable. Conversely, a higher ratio (e.g., 2:1) indicates greater risk for the anticipated reward. Investors use this ratio to assess if the potential returns justify the level of risk involved before making a decision. Aiming for a favorable risk-reward is crucial for long-term success#BinanceAlphaAlert
