Risk:Reward Guidelines
Understanding minimum R:R ratios and why they matter for long-term profitability. Learn how QGA's 3-tier TP strategy maximizes your edge.
Why Risk:Reward Matters
Your win rate alone doesn't determine profitability. A trader with 40% win rate can be more profitable than one with 60% win rate if they have better R:R management.
The Math of R:R
60% Win Rate, 1:0.5 R:R
10 trades: 6 wins × $50 = $300
4 losses × $100 = -$400
Net: -$100 (Loss)
40% Win Rate, 1:2 R:R
10 trades: 4 wins × $200 = $800
6 losses × $100 = -$600
Net: +$200 (Profit)
Breakeven Win Rates by R:R
| Risk:Reward | Breakeven Win% | Outcome at 45% WR | Recommendation |
|---|---|---|---|
| 1:1 | 50% | Breakeven | Minimum acceptable |
| 1:1.5 | 40% | Profitable | Good baseline |
| 1:2 | 35% | Very Profitable | Target this |
| 1:3 | 25% | Excellent | Extended targets |
QGA 3-Tier Take Profit Strategy
Quantum GradeA provides three take-profit levels on every signal, allowing you to scale out of positions and lock in profits while letting winners run.
First resistance/support level. Take partial profits here.
Close 50% of position
Key S/R zone (50% exit). Major structural level.
Close 30% of position
Extended target (let runner). For strong trends only.
Let remaining 20% run
How QGA Displays R:R
Every signal shows the risk:reward ratio for each take-profit level:
Minimum R:R Rule: 1:1
Never take a trade where your potential reward is less than your risk. This is a non-negotiable rule.
- • Risk $100, Target $150+ (1:1.5)
- • Risk $100, Target $200+ (1:2)
- • Risk $100, Target $300+ (1:3)
- • Risk $100, Target $80 (1:0.8)
- • Risk $100, Target $50 (1:0.5)
- • Any trade with reward less than risk
R:R Best Practices
Target 1:2 R:R Minimum for Swing Trades
On 4H timeframe, aim for at least 2:1 reward-to-risk for swing positions
Use the 3-Tier Exit Strategy
Take partials at TP1, TP2, and let TP3 run to maximize profits
Move Stop to Breakeven at TP1
Once TP1 is hit, move stop loss to entry to guarantee no loss
Don't Chase Poor R:R
If price has moved and R:R drops below 1:1, skip the trade