What should be a good stop loss and take profit ratio?
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Thread: What should be a good stop loss and take profit ratio?

  1. #1

    What should be a good stop loss and take profit ratio?

    Hello traders,

    I want to ask something

    what should be a good take profit and stop loss ratio. equal ratio is ok?

    i want your suggestions.

  2. #2
    I think a good ratio is 1:2 in forex trading, so we put a take profit at a price point that is closer to the current price, and we put a stoploss at which point further by ongoing price point. Such ratios are very suitable for swing trading, as stoploss is used to avoid the larger floating loss.

  3. #3
    Trader dkarev's Avatar
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    well our stop loss ratio should depend on the kinda trader we are,Forex trading is all about proper market analysis and the kinda trader one his,as for me,i like to hold my positing for long when trading and my stop loss position normally varies but in ordinarily i think 1:2 ratio is better and if one having much experience about the market,then 1:3 or 1:4 is ok

  4. #4
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    It depends on trader that which ratio they feel comfortable and suitable in their trading. I think the ratio of TP and SL should be 1:3, means if we set tp 3 pips then we can set Sl 9 pips. But this should not work always in a constant basis, sometimes we may change it considering market movement.

  5. #5
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    When I hear people asking of a better way of putting stop loss or take profit it sounds a bit funny because you must realise that there's no common wy of placing your exit price level,hence placing exit point is strictly reliant on your trading strategy,while building your strategy that's when you'll be able to best decide the proper way of placing your exit point.

  6. #6
    Every trader has different perception about their position, profit taking level and stop loss level, They decide as per their margin available, risk taking capacity and profit they want from each trade or on their investment amount.
    But in common profit ; loss ratio should be 2;1.
    If you target 10 pip profit means your stop loss should be 5 pip .

  7. #7
    For me I prefer to calculate stop loss as amount of dollar than pips calculate , because the market has a different movement in daily , so the best setting is put our stop loss at 5 – 10 % from our balance then set of how much we will achieved for that

  8. #8
    Quote Originally Posted by cowek ireng View Post
    For me I prefer to calculate stop loss as amount of dollar than pips calculate , because the market has a different movement in daily , so the best setting is put our stop loss at 5 – 10 % from our balance then set of how much we will achieved for that
    I am agree with you, i am also take dollars for setting the stop loss and take profit and it is the part of the money management system. By it we cannot gets more than 5-10% loss. Our account is safe and we can cover the loss by this method very easily.

  9. #9
    I think 1:2 ratio is the best ratio for stop loss. To reduce your loss you need to make a good risk management plan. Because stop loss is a part of risk or money management. You need to decided it yourself that what is your stop loss because you must have a trading strategy and stop loss totally depend on your balance and your trading strategy.

  10. #10
    Trader dkarev's Avatar
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    majorly only short term trader aim for few pips in this business and aim for few profit ratio as well,a swing trader can aim for a high as possible profit target the most important is the kinda understanding the trading is having on the market,our knowldge on this business determine what we might be aiming for when trading the market.

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