Profit and Loss Ratio and Win Rate: How to Combine Them to Survive Longer?

Some people can't bear to cut their positions and keep waiting for that 3x or 5x trade, resulting in only 2 or 3 wins out of ten trades. Others are completely the opposite—they take profits quickly just for the thrill of "winning often." Honestly, both groups have people making money and losing money.

Where's the key? A simple formula: **Profit and Loss Ratio × Win Rate > 1**. This is the passing line for long-term non-loss.

For example, suppose your profit per trade is twice your loss (a 2:1 profit and loss ratio). As long as your win rate exceeds 33%, you can preserve your capital; if your win rate can stay at 40%, this strategy can basically generate steady profits. Conversely, if you prefer a high win rate strategy, and you earn once but lose twice (a 1:2 profit and loss ratio), you need a win rate of 66% to avoid losing money.

Many people get stuck here: they clearly see the market direction correctly but still end up losing money. It could be because the odds per trade are too small, and the accumulated wins can't cover that one big loss; or because the win rate looks good, but a wrong big-picture judgment causes a loss that wipes out previous gains.

**There is no absolute good or bad strategy, only whether it fits or not.** Most people find it difficult to have both a super high win rate and a super large payout ratio at the same time, but you can definitely find a balance based on your trading style and market conditions.

Before your next trade, ask yourself: what am I relying on for this trade? High win rate or high payout ratio? Think it through before acting. $BTC