#RiskRewardRatio

Risk-Reward Ratio: The Math Behind Smarter Trades

Before you jump into a trade, ask yourself one question: Is the reward worth the risk?

The Risk-Reward Ratio (RRR) helps you answer that. It compares how much you’re risking on a trade to how much you stand to gain. For example:

Risking $100 to make $300? That’s a 1:3 ratio—solid.

Risking $100 to make $50? That’s 1:0.5—not worth it.

Pro traders aim for at least 1:2 or 1:3. Why? Because even if you're only right half the time, the math still works in your favor.

The goal isn’t to win every trade—it’s to make sure your winners outweigh your losers.

Smart trading isn’t just about predictions. It’s about probabilities.