What mindset shift changed your trading most?
One reframing can change everything: "losses are business costs", "the market doesn't know my position", "I'm wrong until proven right". The shifts are personal and powerful.
Post yours:
- the shift and how you arrived at it
- what changed in your behaviour
- how you'd pass it on
The expectancy guide supplies the maths behind many shifts.
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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