Before entering any trade, meticulously assess the. This crucial metric compares the potential profit of a trade to its potential loss. A favorable ratio, ideally greater than 1:2 or 1:3, means the potential gain outweighs the risk. Clearly define your entry point, target profit, and stop-loss level to calculate this ratio. Avoid trades where the potential downside significantly exceeds the potential upside. Disciplined traders prioritize opportunities with attractive risk-reward profiles, enhancing their probability of long-term profitability and capital preservation. Always calculate before you execute. #RiskRewardRatio