Welcome to a deep dive into the Risk to Reward Ratio (RRR) principle - a critical framework for any severe cryptocurrency investor.
It's not just about the potential gains. It's also about understanding and managing your possible losses.
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The RRR is a measure that compares the potential profit of an investment to its possible loss.
The ratio helps an investor to understand and quantify the risk involved in a particular investment.
It's a guiding principle that should be part of every investment strategy.
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A simple RRR might be 1:2. For every dollar you risk, you aim to make two.
This might seem straightforward, but the application and discipline to maintain this approach require an in-depth understanding of the market and your investment strategy.
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In this thread, I will share the summary with you.
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Most publications either:
• focus on the technical side of blockchain and are not for the investors,
• recommend specific coins without explaining why these and not others, or
• only use technical analysis or wish thinking.