RISK/REWARD RATIO (SWING TRADING GUIDELINES TO FOLLOW)
What is a Risk/Reward ratio?
Risk/Reward is a tool used by investors and traders alike to calculate the risk they are taken on for a potential reward in any given trade. The ratio varies from investor to investor but the most standard risk/reward ratios are 1:2 or 1:3. In our infographic; we explain the risk/reward breakdown with our $25,000 model portfolio.
Risk/Reward is a tool used by investors and traders alike to calculate the risk they are taken on for a potential reward in any given trade. The ratio varies from investor to investor but the most standard risk/reward ratios are 1:2 or 1:3. In our infographic; we explain the risk/reward breakdown with our $25,000 model portfolio.
* This website is for information and illustrative purposes only. It is not, and should not be regarded as investment advice or as a recommendation to buy, sell and/or hold any securities mentioned. All investments carry risk, there are no guarantees. Investors should consult with their advisers with respect to their investments. Please read our full disclaimer here. *Disclaimer: these results are atypical and the illustration is meant to show how you can come out net positive at the end of the year and/or quarter with a 1/2 win rate.
Compound Interest: we used our standard $25,000 initial investment; with a monthly add of $1,250 and an interest rate return of 60%.
Compound Interest: we used our standard $25,000 initial investment; with a monthly add of $1,250 and an interest rate return of 60%.