What is Risk to Reward?
Updated October 19, 2026
Risk to reward compares how much you could lose on a trade to how much you could win.
If you risk 20 pips to make 40, that's 1 to 2 risk to reward.
A good ratio means you can be wrong often and still come out ahead.
It works together with win rate. A great ratio with a tiny win rate can still lose.
Example
Stop loss 30 pips, take profit 90 pips, so risk to reward is 1 to 3.
Questions people ask
What's a good risk to reward?
Many traders aim for at least 1 to 1.5 or 1 to 2.
Do scalping bots have low ratios?
Often yes, and they rely on a high win rate instead.
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