This is the hidden benefit. Using this ratio forces two critical habits:

1. You let your winners run. You have a reason to be patient. Instead of snatching a tiny profit, you’re waiting for that full reward, which is how you actually build real wealth in trading.

2. You respect your stops. Taking a small, planned loss feels okay because you know one good trade will make it more than right. It turns a loss from a personal failure into a simple business expense.

But What If My Strategy Is Different?

That’s fine! This isn’t a one-size-fits-all world.

• If you’re a scalper with a lightning-fast strategy that wins most of the time, a 1:1 ratio might be your jam. Your volume of small wins adds up.
• If you’re a patient swing trader who can sit on trades for days, shooting for a 1:3 or higher can be amazing. You’ll have fewer wins, but they’ll be home runs.

The “best” ratio is the one that fits your personality and strategy and keeps you within the prop firm’s rules.

Conclusion – What Is the Best Risk-to-Reward Ratio for Prop Firms?

Honestly, the ratio is important, but it’s nothing without this:

Consistent risk per trade.

It doesn’t matter if you’re aiming for 1:2 if you risk 5% on one trade and 0.5% on the next. The magic happens when you combine a positive reward ratio with rock-solid risk management. Risk a small, fixed percentage every single time (like 0.5% or 1%). That discipline, more than any ratio, is what gets people funded.

Frequently Asked Questions  – What Is the Best Risk-to-Reward Ratio for Prop Firms?

1. I can’t always find 1:2 trades. Should I just not trade?

Yes. Seriously. The hardest skill in trading is sitting on your hands. Forcing a trade that only offers a 1:1 reward is a great way to grind down your account. Wait for the good ones. Patience isn’t passive; it’s an active strategy.

2. Isn’t a higher win rate better than a good ratio?

They work together. You need to know your strategy’s personality. Does it win often but with small gains? Or does it win less frequently but nail big moves? A 40% win rate with a 1:2 ratio is profitable. A 60% win rate with a 1:1 ratio is also profitable. The key is to know which one you’re executing so you don’t get discouraged.

3. How do I actually set this up on a chart?

It’s about levels. Look for a clear support level to buy at. Place your stop loss a comfortable distance below it. Then, look up. Is the next resistance level at least twice that distance away? If yes, you have a valid 1:2 trade. If no, it’s not a good setup. Wait for a better one.

We have helped thousands of traders reach funding at TTT Markets from account sizes of $5k upwards to $500k. Check out our programs.