1. What Is the R:R Ratio?
The risk–reward ratio, or R:R, compares the amount you can lose with the amount you can gain on a trade.
2. Why Does It Matter More Than Win Rate?
📊 A Mathematical Demonstration
Trader A: Win rate 70%, R:R 1:1.
10 trades → 7 wins and 3 losses → net profit = 7-3 = +$400
Trader B: Win rate 40%, R:R 1:3.
10 trades → 4 wins (×$300) and 6 losses (×$100) → +$600
Trader B earned more with a 40% win rate!
A high R:R can produce profits even with a low win rate.
3. Optimal R:R Ratios
- At least 1:2 — The basic threshold; do not enter below R:R 1:2.
- Ideally 1:3 — A professional trader's standard.
- 1:5+ — A home-run trade, possible through trend following.
4. How to Calculate It
💡 Example
Entry price: $70,000
Stop-loss price: $69,000 (risk = $1,000)
Target price: $73,000 (reward = $3,000)
R:R = 1,000 : 3,000 = 1:3 ✅
5. R:R at NOONOO TRADING
NOONOO TRADING is designed to prioritize growth in PnL over win rate. It seeks an asymmetric return structure: large gains on winning trades and small losses on losing trades.