If you’re new to trading, you should always focus on trading in terms of positive risk: reward relationship. The simple but very important logic of trading with good or great risk: reward ratios is that you will have a hard time growing your account if you continue to lose large chunks of your account because of poorly planned trades. Another way to view the importance of risk: reward is in thinking that if you were the captain of a ship, you wouldn’t focus on your destination if you had a big hole in your boat, rather you’d know that your progress will be heavily hindered until you fix the leak. Why Risk: Reward Is ... (full story)