How to read the result
A 1:2 risk-to-reward ratio means you make $2 for every $1 risked when the trade works. The breakeven win rate is the number most traders skip: at 1:2 you only need to win 33% of the time to break even; at 1:3, just 25%; at 1:0.5 (risking more than the target), you need 67% — a bar very few retail strategies clear consistently.
The ratio is a claim — your journal is the evidence
A generous ratio on the chart means nothing if the market rarely reaches your target. The pair of numbers that matters is your planned R:R versus your achieved win rate on that setup — and only a trade log produces the second number. If your journal shows your 1:3 breakout setup wins 30% of the time, that is a profitable system. If it wins 18%, the beautiful ratio was fiction, and the data just saved you a year of slow bleed.
Common risk/reward mistakes
- Widening the stop after entry — quietly turns a planned 1:2 into an actual 1:0.8; the trade you took is no longer the trade you planned
- Taking profit early at 1R on a 1:3 plan — your expectancy math assumed 3R winners; cutting them makes the whole system unprofitable at the same win rate
- Comparing ratios across setups without win rates — a 1:5 setup that never triggers loses to a 1:1.5 setup that wins 60%
Track planned versus realized R on every trade automatically — Edgelog computes both when your trades sync from MT4/MT5, Binance, or Bybit, and its analytics show expectancy per setup. See the forex journal guide for the full workflow.