$BTC How to calculate the R/R ratio 

Determine the amount you could lose if the investment fails (the risk)

Determine the amount of profit you could make if the investment succeeds (the reward)

Divide the risk by the reward

What the R/R ratio tells you

A ratio greater than 1 means the risk is greater than the potential reward 

A ratio less than 1 means the potential profit is greater than the risk 

Using the R/R ratio

The R/R ratio helps you decide whether to take on a trade or not 

It helps you decide where to close out a trade to take profits or avoid losses 

It helps you understand the risk-reward trade-off 

Recommended R/R ratios

Trade advisers and professionals often recommend a ratio between 1:2 and 1:3. However, the acceptable ratio can vary depending on your strategy and risk tolerance.