1:0.5 RR with 74% WINRATE vs 1:1 RR with 58% WINRATE, what would you choose?

Trading Discussion Risk Management Practices
1

So it seems that I have fully developed a mechanical system trading on live conditions. I am trying to optimize the expectancy of my SCALPING strategy as much as possible, so which RR would be more sustainable, in the long run, considering these statistics with +120 trades?

Thank you in advance!
Happy trading!

2

The sweet spot is 1:1.5 RR in normal circumstances. Let the win rate take care of itself, by backtesting it.

I am aware of a very profitable and successful trader who scalps the one minute charts with zero spread, and who cuts losses if the first candle fails, which is a c.20% win rate.

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4

1:0.5 rr at 74%

Win: 0.5 x 0.74= 0.37
Loss: 1 x 0.26= 0.26

Expected value= gain of 0.11r per trade

1rr at 58%

Win= 1 x 0.58
Loss= 1 x 0.42

Expected Value= gain of 0.16r per trade

Your highest EV is with the 1:1 rr at 58% winrate

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