Risk Management Mastery·Beginner· 4 min

Risk-to-reward planning

Why 2R is the minimum most pros will even consider.

The idea

R = your stop distance in dollars. A '2R' target means you're aiming to make 2× what you're risking. At 2R, you can be wrong 60% of the time and still be profitable.

How to check R:R BEFORE entry

Measure the distance to your logical target vs the distance to your stop. If the ratio isn't at least 1.5R–2R, skip it. Better setups will come.

Trailing

Consider partial exits at 1R (move stop to breakeven, banking a free trade) and let the runner target 3R+.

Watch it on the chart

Chart breakdown

Chart with a stop-to-target ratio measured with a visual ruler tool.

Key takeaways

Never plan a trade with less than ~2R potential.
R:R < 1 means you need to be right 60%+ just to break even.
Partial at 1R + BE stop = free R.
R:R is decided before entry, not after.

Quick check

Setup: stop is 8 points, target is 12 points. What's the R:R?

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