Reward-Risk Ratio

Reward-Risk Ratio
Monthly excess return to risk comparison, calculated by dividing alpha by standard deviation. (A ratio better than 0.4 is excellent.)
Reward-Risk Rank
Stocks ranked in descending order by reward-risk ratio.

Reward-Risk Ratio
An estimate of the potential gain of a trade versus the potential loss.
Reversal Stop ...

Reward-Risk Ratio: The mathematical relationship between the maximum potential risk and maximum potential reward of a trade.

Reward-Risk Rank: Stocks ranked in descending order by reward-risk ratio.
Reward-Risk Ratio: Monthly excess return to risk comparison.
This is calculated by dividing alpha by standard deviation.
Rich: Price higher than expected.

A good setup points to this price through support-resistance, pattern recognition and the reward-risk ratio. A couple of limitations affect execution targets, though.

Commodity Investments: Assessing Reward-Risk Ratios
There have been severe volatility levels in commodities trading in the last few years and investors need to assess the reward risk ratio when hedging against these instable price moves.

Therefore, the reward-risk ratio is £250/£100 = 2.5. For most trades, the ratio should be between 2 and 3, with exceptional trades giving ratios of 5. If the average is 3, you can get seven out of 10 trades wrong and still make a small profit.

See also: Profit, Market, Trading, Trader, Order