Risk Lab
The system tells you where to enter. Risk management decides whether you're still trading next year. This is the sequence to run before every order — the default is 1% risk per trade, the same as the tested system.
1 · Account → risk → stop → size → target
Notice the order: the stop comes first (from the chart or ATR), and the size follows. A wider stop means a smaller position, not a bigger loss. Every trade risks the same 1%.
| Level | Price | Distance | P/L |
|---|---|---|---|
| Stop −1R | 97.00 | 3.00 | −$100 |
| 1 : 1 | 103.00 | 3.00 | +$100 |
| 1 : 2 | 106.00 | 6.00 | +$200 |
| 1 : 3 | 109.00 | 9.00 | +$300 |
| 1 : 5 | 115.00 | 15.00 | +$500 |
R is your unit of risk. Measuring in R instead of money makes every trade comparable: one 3R winner pays for three losers.
2 · Why being right often isn't everything
Approximate figures from backtests. Past results don't guarantee future performance. See the backtest →
Reshuffle to see a different sequence with the same odds. The edge is unchanged — the path isn't. That's what probability feels like in live trading.
Being right 70% of the time while taking small wins and full losses slowly bleeds the account. A system that wins less than half the time, but wins bigger than it loses, grows. Trading is a game of probability and risk control, not a game of being right every time.
3 · Expectancy map
| Win rate ↓ · Reward:risk → | 1:0.5 | 1:1 | 1:1.5 | 1:2 | 1:3 | 1:5 |
|---|---|---|---|---|---|---|
| 30% | -0.55R | -0.40R | -0.25R | -0.10R | +0.20R | +0.80R |
| 40% | -0.40R | -0.20R | +0.00R | +0.20R | +0.60R | +1.40R |
| 45% | -0.33R | -0.10R | +0.13R | +0.35R | +0.80R | +1.70R |
| 50% | -0.25R | +0.00R | +0.25R | +0.50R | +1.00R | +2.00R |
| 60% | -0.10R | +0.20R | +0.50R | +0.80R | +1.40R | +2.60R |
| 70% | +0.05R | +0.40R | +0.75R | +1.10R | +1.80R | +3.20R |
Expectancy = win% × reward − loss% × 1R · Green = sustainable · Red = a slow leak · Outlined = roughly where our system sits