Risk:Reward Ratio

How much you stand to gain compared to how much you're risking on a trade — e.g. 1:2 means risking 1,000 to make 2,000.

With a 1:2 ratio, you can be right less than half the time and still come out ahead — 4 wins and 6 losses out of 10 trades still nets a profit. This is why chasing a high win rate alone isn't the real goal; the ratio between average win and average loss matters just as much.