WickCheck / Trading school / Risk to reward

Risk to rewardRRBeginner

How far the target is compared with the stop. A 1:2 trade risks 1 to make 2.

target +2Rentrystop −1R
Simplified illustration, not real market data.

What it means

A higher RR needs a lower win rate to break even: 1:1 needs over 50%, 1:2 needs over 33%, 1:3 over 25%, before costs. But bigger targets are hit less often.

How to spot it

Common mistakes

Related terms

R and R-multipleR is the amount you risk on a trade. A result of +2R means you made twice what y…Win rateThe share of trades that make money.…ExpectancyThe average result per trade, usually in R. Positive expectancy means the strate…
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