#RiskRewardRatio

The risk-reward ratio is my go-to compass before entering any trade. According to a 2024 CoinShares trader behavior study, traders who consistently applied a minimum risk-reward ratio of 1:2.5 saw up to 27% higher long-term profitability than those who didn’t. Personally, I use TradingView’s built-in long/short position tool and calculate potential reward vs. risk using support/resistance zones and ATR (Average True Range) indicators. For example, if I'm risking $100, my minimum target is $250. This way, even with a 40% win rate, I stay profitable. It's not about winning every trade—it's about maximizing the reward when you're right and minimizing damage when you're wrong.