Interface
Let's start by explaining the interface of the risk / reward feature.
Definition / Explanation
Stop Loss Price
A stop loss is a price placed with a broker to close a position when it reaches a certain price. Stop loss prices are designed to limit a traders loss on a position.
Initial Risk $ Amount
Based on the stop loss price we automatically calculate the $ amount you initially risked when you entered the trade.
Profit Target Price
A profit target (also called "take profit") is a predetermined point at which a trader will exit a trade in a profitable position.
Initial Reward $ Amount
Similar to the initial risk we also calculate the $ amount you would receive (reward) when the position would reach your profit target price.
Planned Risk / Reward Units
We automatically calculate the risk / reward ratio when you set a stop loss and a profit target based on your initial entry price.
Effective Risk / Reward Units
Additionally to "planned risk / reward units" we also calculate the effective risk / reward units you gained after a trade.
On a profitable positions we calculate the effective risk / reward by using your stop loss price, average entry price and average exit price.
On a negative position we assume that the positions was closed at your stop loss price. That's why the effective risk / reward always shows -1.00 units on a negative positions.
Use Chart Lines
After you a set stop loss or profit target value we'll display drag-able lines directly in the chart to visualize the values.
You can move the target and stop price by dragging the lines and move your mouse up or down.
Hide Chart Lines
If you don't want to see the risk / reward lines then you can click on the "Toggle R / R Lines" button in the chart toolbar.
