Win less than half and still profit? Risk to reward, explained

You can be wrong more than half the time and still make money.

Here's the simple math.

Risk 1 to make 2. Your target is twice as far as your stop.

Say you risk 100 dollars on every trade, and aim for 200.

Ten trades. You win only 4. Four wins at 200 is plus 800.

Six losses at 100 is minus 600. You're up 200, before costs.

Now flip it. Risk 100 to make 100, same 4 wins.

Plus 400, minus 600. You're down 200, with the same wins.

So the reward has to beat the risk. Check it before you enter.

On this gold chart: buy at 4140, stop at 4120. That's 20 dollars of risk.

Target 4180, 40 dollars away. That's 1 to 2.

This one reached 4180. Many won't. That's why the math matters, not one trade.

If the target is closer than the stop, skip the trade. Or find a better entry.

Save this. Measure the stop, measure the target. Aim for at least 1 to 2.

Your turn. What's your usual risk to reward? 1 to 1, 1 to 2, or never checked? Comment below.

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