This is where we come to a close on this thread, friends. Thank you.
Rationale behind "Risk Per Trade" and "Risk/Reward Ratio"? 8 replies
Regarding risk/reward ratio 10 replies
Is a high risk reward ratio overrated? 12 replies
Good reward/risk ratio experiment 20 replies
Risk Reward Ratio and Account Risk 30 replies
DislikedI don't understand the logic or the math behind those statements.
How can he risk more? One side of the ratio, risk, could be identical.Ignored
DislikedHow can he compound faster? Unrealised profit is still profit which can be utilized.Ignored
DislikedHow does a higher win rate using 1:1 have less drawdown than a lower win rate and better than 1:1? If anything the opposite is more likely to be true.Ignored
DislikedWhy is there less risk of trader error? Again the opposite is more likely to be true as he trades more frequently.Ignored
DislikedYes they are, but not for your scenario. There's nothing better than watching a trade make money without any exposure to risk and profit being locked in as the trade develops, whereas every new trade has new exposure to risk. If the trader has psychological issues with trading and taking risk (which really need to be addressed and resolved) then risk free has simply got to be better than taking on new risk with his higher frequency of trades.Ignored
DislikedOr.....you could trade in the right direction, let profits run, compound gains within a profitable open trade, and 'milk' 5% from a single trade. And all with the one initial risk which is reduced to zero with profits locked in as you go.
-Ignored