I'm interested in what people think about the relationship between the Win/Loss Ratio and the R/R Ratio.
1.If we want a good R/R ratio, does that mean we should be ready to accept a bad win %? In other words, does having a good R/R Ratio mean that your win percentage will suffer? Example of this would be a typical trend following system, where the win % is usually below 50% but cause the winners are let to run, the R/R Ratio is good. Example of this type of trading, Soultrader.
2.If we want a good win percentage, does that mean we should be ready to accept a bad R/R Ratio? In other words, does having a bad R/R Ratio mean that your win % will be good? Extreme example of this type of trading would be some scalping strategies like Stiviet (the way he trades lately) with 1000 pips SL and 10 pips TP. Stiviet has menaged to get over 300 wins in a row, but the drawdown of his losing trades can be big, hence a bad R/R Ratio.
What's your opinion of the link between the Win/Loss Ratio and R/R Ratio? Is there one? If so, how significant is it? Your experiences and/or research are welcome. Any links to articles,research etc... on this subject are welcome. Let the discussion begin.
1.If we want a good R/R ratio, does that mean we should be ready to accept a bad win %? In other words, does having a good R/R Ratio mean that your win percentage will suffer? Example of this would be a typical trend following system, where the win % is usually below 50% but cause the winners are let to run, the R/R Ratio is good. Example of this type of trading, Soultrader.
2.If we want a good win percentage, does that mean we should be ready to accept a bad R/R Ratio? In other words, does having a bad R/R Ratio mean that your win % will be good? Extreme example of this type of trading would be some scalping strategies like Stiviet (the way he trades lately) with 1000 pips SL and 10 pips TP. Stiviet has menaged to get over 300 wins in a row, but the drawdown of his losing trades can be big, hence a bad R/R Ratio.
What's your opinion of the link between the Win/Loss Ratio and R/R Ratio? Is there one? If so, how significant is it? Your experiences and/or research are welcome. Any links to articles,research etc... on this subject are welcome. Let the discussion begin.