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RE: A Simple Lesson in Risk Management
well if you target is twice as close as your stop loss then basic probability is in your favour. you can then improve your profitability with 'runners'. happy to elaborate if that doesnt make sense.
So i guess its not really 2:1 .. its 2:1 on the first 66% of the trade. Once that target is met you can zero your stop loss and have 0:infinite on the remaining 33%..
Makes perfect sense! I use the same method with my positions, once target one has been achieved I'll move my stop loss into profit to bulletproof the trade.