Risk Reward and Trading Stategy

PipMuncher

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Hi All,

So - I'm kinda new to trading - and am currently developing my own Strategy but get real confused by the way people talk about their risk reward strategy.

Phrases like "I trade with a 25 pip trailing stop' or ''a 1:1 risk reward ratio" seem a steadfast.

Surely every trade is assesed on its own merits - taking into account relative technical levels when setting stop/take profit levels.

If a price level that invalidates your market view is just 15 pips below your entry point but you can see a potentual 50 pip profit surely you would just set you stop/take profit accordingly!

Or am I missing part of the picture here?
 
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