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YAby u/yarabakri·10mAnalysis

Understanding Risk-Reward in Trading

Risk-reward ratio isn't about specific price points like $MATIC at 0.2826; it's a fundamental concept determining if a trade's potential gain justifies the potential loss, often used before considering position sizing. A 1:2 ratio means for every dollar risked, you expect to gain two, crucial for long-term profitability even if not every trade wins.

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