{"slug":"r-multiple","term":"R-Multiple","category":"Quant & Stats","definition":"An R-multiple expresses a trade's outcome as a multiple of the amount risked at the stop: a trade that risks $100 and makes $250 is +2.5R; one that loses the full stop is −1R. It normalises results across different sizes and prices so a record can be read as a distribution of R rather than a pile of dollars.","street":"Stop counting dollars. Count how many times your stop you made or lost — that is the only number that compares one trade to another.","depth":["Define R at entry as entry minus stop for a long. Target minus entry divided by R is the planned reward-to-risk; the realised R is what actually happened, including stops that filled worse than the level. A ledger in R makes expectancy trivial: average R per trade times trades per month is your edge in stops per month. Our setups state target and invalidation, so every call has a planned R.","The trap is letting R drift after entry: moving the stop wider turns a −1R loss into −2R without changing the thesis, and taking profit early turns planned +1.7R trades into +0.6R trades that make the win rate look fine while expectancy quietly dies. Judge a strategy by its R distribution over enough trades — not by its win rate, which alone says nothing."],"live":{"label":"Pattern trade plans, target against stop","href":"/patterns"},"related":["position-sizing","risk-reward","expectancy","win-rate","sample-size"]}