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The Power Of The Bank Trading Strategy:

In 10 years of trading there is one thing that has been at the core of every successful trader
I have ever met, asymmetric risk/reward ratios. Now see how works Bank Trading Strategy , If you’re losing money trading I can almost guarantee that your overall R/R ratio will be less than 1 to 1.

The power behind the bank
trading strategy is the R/R ratios these setups produce. Because these setups often catch short term turning points in the market they lend themselves to high R/R trading. (Bank Trading Strategy)

Let’s do some math to illustrate the point. Imagine you take 1 trade per day. With an average of 22 trading days a month that would give us 22 different trades.

For our example we will use a risk of 2% per trade and a win/
loss ratio of only 50%.

Let’s see how this breaks down over the course of 12 months.
22 Trades Total:
11 Winning Trades X +4% Per Winning Trade = +44% On The Winning Trades
11 Losing Trades X -2% Per Losing Trade = -22% On The Losing Trades
+44% On The Winning Trades Minus -22% On The Losing Trades = +22% Monthly Total

If you make 22% per month on a $5,000 account you will have $54,361 at the end of the
year if you compound the profits each month. Obviously this is a perfect world scenario but as you can see even with a 50% win/loss ratio and a high R/R ratio the potential is huge. “Bank Trading Strategy”

So many times trades associate success with a win/loss ratio when really success often has nothing to do with a win/loss ratio and is almost exclusively related to the R/R ratio your trading strategy produces.

If you take nothing else away from the information in this
strategy then take away the importance of R/R ratios.
The numbers described above show the importance of R/R ratios. Obviously it’s not as
simple as setting your take profit to two times your risk and then hoping for the best.

A strategy must be designed around R/R in order to take advantage of it successfully.

Because the primary focus of the bank trading strategy is catching market turning points
the setups will always by their very nature produce high R/R scenarios. Catching turning
points in the market will decrease the win/loss ratio overall. It is important however to keep in mind what your goal is. Is your goal to be profitable or produce a high win/loss ratio?

As an example would you rather win 70% of the time with a 1/1 R/R or would you rather win
50% of the time with a 2/1 R/R ratio?

If you do the math on it you will quickly realize the high
R/R ratio and 50% win/loss ratio example is far more profitable than the 1/1 R/R strategy that wins 70% of the time.

Again…is your goal to be profitable or is it to produce a certain win/loss ratio?