#RiskRewardRatio The Risk-Reward Ratio (RRR) is a crucial metric in trading that compares the potential profit of a trade to the potential loss. It helps traders evaluate whether a trade is worth taking based on the risk involved.

How to Calculate Risk-Reward Ratio:

1. Identify Entry Point – Where you plan to enter the trade.

2. Set Stop Loss – The price level where you’ll exit the trade if it moves against you.

3. Set Take Profit – The price target where you’ll exit to take profit.

4. Calculate:

Example:

• Entry: $100

• Stop Loss: $95

• Take Profit: $115

Risk = $5, Reward = $15

RRR = 5:15 or 1:3