introducing the five topic#RiskRewardRatio The risk-reward ratio in crypto (or any investment) is a way to evaluate how much risk you're taking for a potential reward. It's calculated like this
Risk-Reward Ratio = (Potential Loss) / (Potential Gain)
Example:
You buy a crypto at $100.
You set a stop loss at $90 (risk = $10).
You aim to take profit at $130 (reward = $30).
Risk-Reward Ratio = $10 / $30 = 1:3
This means you risk $1 to potentially gain $3. Lower ratios (like 1:2 or 1:3) are generally considered better because they offer more reward for less risk.
Why It Matters in Crypto
Volatility: Crypto is super volatile, so defining your risk reward keeps your emotions in check.
Discipline: It helps you stick to a strategy and not chase pumps or panic sell dips.
Long-Term Gains: Even with a 40% win rate, a good risk-reward setup (e.g., 1:3) can still make you profitable.
#RiskRewardRetio $BTC bullish momentum