for all these idjits who claim that a "reverse risk/reward ratio" is bad..
please study some math, game theory, probability, etc.
*if* (and that's a BIG if) a trade is 90% winning trade, then a 4:1 "risk/reward" (that is really not a proper use of that term, but lets not devolve into semantics) is ENTIRELY reasonable and profitable
what matters, in the long run - is positive expectancy.
a trade setup's stop/target distance is dependant on a # of factors, but as long as it has positive expectancy, than having a larger stop vs. target (or 1st target) is both logical and produces positive expectancy
i have some setups that have a 2:1 "risk/reward". others have a different ratio.
so what?
i suggest that people who think that the only way to trade successfully is to risk (stop distance) less than the reward (target distance) have no understanding of successful intraday futures trading.
again... what matters is positive expectancy
as for "losing a significant chunk" of his account on one trade... that's another story entirely.
that's just bad money management. i can teach it all day and night, as can puretick, but if a trader won't use proper position sizing, he's most likely dead at some point.
