Trading Strategy Analysis: Win Rate vs Risk-Rward Ratio Debate

The Reddit discussion from r/Daytrading reveals practical trader experiences with both approaches:

• OP’s Success Story
  : The original poster found improved consistency and profitability by cutting targets to 1R after observing trades frequently reached ~1R but not 2R/3R, achieving ~75% win rates Reddit

• Psychological Preference
  : Multiple traders emphasize the psychological benefits of high win rates. TimeToEndThis_Now reports hyper scalping with 90%+ win rate and 1:1.8 RR, preferring high win rate for psychological comfort Reddit

• Hybrid Approaches
  : SanskrutiChaiBar runs both systems - high WR (75%, RR 1.5-3) to cover drawdowns of low WR (35%, RR 4-9), maintaining similar psychology across both Reddit

• Account Type Matters
  : CupLower4147 notes cash accounts favor high RR for growth, while prop firms often require high WR/low RR due to consistency rules Reddit

• Risk Management
  : ZanderDogz emphasizes that lower WR systems can return more R over time but with higher losing streak risk, while higher WR allows larger position sizing Reddit

Expert analysis provides mathematical and psychological frameworks:

:

• 1:1 risk-reward ratios require 50%+ win rates to break even and 60%+ to be profitable LuxAlgo
• 2:1 risk-reward ratios need only 33% win rates to break even and 40%+ for profitability BajajFinserv
• 3:1+ ratios are considered ideal by many experts as they allow profitability with even lower win rates TradingView

:

• Frequent small wins create positive psychological reinforcement and build trader confidence ColibriTrader
• Consistent positive outcomes help traders maintain discipline and stick to their trading plans ForexRecon
• High win rates enable better emotional control as traders experience fewer devastating losses ColibriTrader

:

• Most professional traders aim for 1:2 to 1:3 ratios as the optimal balance OptionsTrading
• The combination of win rate and risk-reward ratio determines overall profitability, not either metric alone LuxAlgo

The Reddit discussion and expert research reveal both convergence and tension in the win rate vs risk-reward debate:

:

• Both sources acknowledge that neither metric alone determines success
• Psychological factors play a crucial role in strategy selection
• Personal trading style and risk tolerance should guide approach choice

:

• Reddit traders report practical success with 1:1 ratios and high win rates, while experts generally favor 2:1+ ratios
• The mathematical efficiency of higher risk-reward ratios conflicts with the psychological comfort of frequent wins

: The optimal strategy appears context-dependent. Prop firm traders and those requiring consistency may benefit from high win rate approaches, while independent traders focused on long-term growth may favor higher risk-reward ratios.

:

• High win rate strategies can lead to overconfidence and poor risk management during losing streaks
• Low win rate/high risk-reward approaches may cause psychological stress from frequent losses
• Copying others’ strategies without matching personality type often leads to failure

:

• Hybrid approaches can balance psychological comfort with mathematical efficiency
• Account type optimization (cash vs prop) can guide strategy selection
• Position sizing adjustments can compensate for different risk-reward profiles

: Traders should focus on expectancy calculations rather than fixating on individual metrics, while ensuring their chosen approach aligns with their psychological makeup and trading objectives.