#RiskRewardRatio Risk/Return Ratio: Key to Wise Investment Decisions**

The risk/return ratio (#RiskRewardRatio) is one of the fundamental concepts in the world of investing and trading, as it measures the relationship between potential loss and expected return of a transaction. This ratio is based on a simple principle: to determine the amount of risk you are willing to take compared to each unit of potential return. The lower the ratio (like 1:2), the more attractive the operation is, as the expected return significantly outweighs the risk.