How do you verify a trading claim you read online?
"This indicator has a 90% win rate" — every claim needs the same questions: over what sample, after what costs, with what rules, survivorship included? Asking them is a skill traders develop slowly.
What's your checklist?
- the questions you ask of any claim
- the claim you once believed and later debunked
- how you test claims cheaply before trusting them
The expectancy guide supplies the debunking maths.
Background: Risk-reward ratio, win rate and expectancy: the maths behind a trading edge
A high win rate can still lose money. See how win rate and risk-reward combine into expectancy, with break-even win rates and worked examples.
What is a good risk-reward ratio in forex?
There isn't one right ratio. What matters is expectancy, the win rate and ratio together. A 1:2 ratio breaks even at about 33% winners before costs, while a 1:1 ratio needs 50%.
How do you calculate trading expectancy?
Multiply the win rate by the average win and subtract the loss rate multiplied by the average loss. Measuring wins and losses in multiples of the amount risked (R) makes the result easy to compare.
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