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See your reward-to-risk ratio and the win rate you'd need just to break even. R:R = reward ÷ risk.
Most beginners obsess over their win rate, how often they're "right." But you can be right most of the time and still lose money if your losers are bigger than your winners. Risk/reward is the fix: it measures how much you stand to make versus how much you stand to lose on each trade.
The powerful part is the break-even win rate. At a 1:2 ratio (risk $1 to make $2), you only need to win about 33% of the time to break even. At 1:3, just 25%. A good reward-to-risk ratio lets you be wrong far more often than you're right and still come out ahead, which is exactly how disciplined traders survive.
The catch: a target you'll never realistically hit isn't real reward. Set the stop and target where the chart justifies them, then let the ratio tell you whether the trade is even worth taking.
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