thread: 1:1 Risk Reward Ratio - Why it just makes sense

If profit variable, which is the product of the two win% and average RR, stays significantly more than 1 time, then you are profitable. It is equally as easy, and as difficult, as that.

Ill take a profit factor of 1.1 that trades 10 times every day of over a system with a profit factor of 10 that trades 10 times a year. The impact of compounding and commerce frequency may have a more substantial impact on gains than profit variable

Reducing your profit targets allows a better win ratio which in return enables compounding to excel (relative). I can do this when the market is trending and consolidating with the very same results without having to reduce or lengthen take profits and ceases. A win ratio in greater or the 60% range a few trades with two% risk per trade what else would you need.

That is my experience also. It is not an idea or theory however proven by myself in the market

the most profitable traders with Oanda throughout the last 7 days trading EUR/USD averaged 15.9 pips per winning trade and 14.3 pips per losing trade. Thats exactly what the men who are earning the money are currently doing - FACT!

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Cindyxxx suggest you create a research in risk/reward.
. . .your on the ideal path. . The risk% is very important if you want reward.

You want atleast 50 trades. Subsequently its possibel to calculate excact risk%,
that is optimal for you. .

Truth isn't any way can do the job. It is too random to conduct through the various things that increase or decrease the profit curve here. In the ideal market conditions targeting reward ratios that are greater to risk will achieve higher yields. Nonetheless, it is a generalization to state this could be the case for all traders.

It is a no brainer FOR ME to change to exchange this way because my entries are great in most market conditions so I will comfortably increase my risk supplied I will still exchange the same manner without emotions coming to play, lower my target to one that is achieved more frequently and so achieve the same or better outcomes. (also for all the reason I outlined in my initial article in this thread which I can't be bothered repeating).

This is not system hopping, just adapting my method as my confidence grows and consequently my desire to make epic 100 -200 pip trades abruptly is no longer required by my ego.

Everyones different it has taken me literally years to find an exit method I am comfy with. My previous one was great but I think this to be greater FOR ME.

Do your testing however.

Men, I want you happy trading. It is my birthday now 42 god help me:--RRB- I'm in my way to the airport to get a quick few days in Thailand.

All of the best.

No one cares

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Nah, apparently the conventional wisdom of century-old maxims and all the regularly repeated advice from recognized and well respected experts is wrong, FF members understand better....

the most profitable traders using Oanda over the previous 7 days trading EUR/USD averaged 15.9 pips each winning trade and 14.3 pips each losing trade. Thats exactly what the men who are earning the money do - FACT!

The (unreliably reported) short term execution of Oanda traders is now the yardstick by which we measure success, and people are the folks we should aspire to emulate within our trading? Really?

Oh boy, why didn't anyone tell me this before!

~16 pips 1:1 trading Eur/Usd within the past week, wooohooo!

An option could be focussing on and handling something which you do have total control over, exploiting the instances you're right to the maximum, compounding profit and reducing risk in a commerce, having reduced overhead, and less probability/need of overtrading.

The option of whether to exploit 1 trade for all it's worth, without risk, rather than taking the cash and running over and above, with much more risk, really is a simple and logical choice to make for me personally. I can't understand why anyone would purposely avoid the chance to make money...

You do not have to hold a 200 pip exchange to it's 200 pip top or underside maximize it's potential. You may note that in the very best prices that the market will go the fastest out of there is the scalpers who leap out. . The heavyweights shaking out and all the games in between all the way to that 200 pip target.

Anyway... Those 200 pp trades will move the fastest from the best prices and you only have to add to them a few times in the lower end of the spectrum to get the identical impact of hanging on for the full monty. Trouble is you can't have your cake and eat it as well. To perform both requires some serious balls and openness to get pipped out of trades that are great over and over again. This IS plogically demeaning, and not even necessary. The benefits are of course satisfying,,, when they repay.

My only point is... as you said, in handling your own trade and managing your cash you do not have to remain in the market and ch the top or base to maximize a excellent call. Give it more weight and you have to note it early on. It's still possible to let your winners pay you cut your losses short on 1:1 r:r.

Anyway that's my argument on that. I could make a case for either manner.

Icing with this particular cake is the fact that markets range 75% of the time.

In my expertise traders will always favor 60% win rate and 1/1 r/r over 40% win rate and 2/1 r/r...

People just unconsciously wish to be a winner!!!

I would take 40 percent at 2/1 anyday, palms down... not likely to go into detail, so there is out traders out there that is going to explain why, in case you're interested.

Expectancy and potential are just two things that have to be researched though...

http://www.nobrainertrades.com/2010/...placement.html

You don't have to hold a 200 pip trade to it is 200 pip top or underside maximize it's potential.

I agree, but surely when the market has the capability to supply more then it would be counter productive to deny it that opportunity simply due to some arbitrary R:R figure conjured up by a trader who has a need to be right more times than incorrect and an impulse to continuously bank profit, which wouldn't make sound financial or logical sense could it?

I know there's an expression about a bird in the hand but come on, why settle for one bird when there are potentially two, three, or more just there for the taking, particularly when the risk is the same or not.