Best trading strategy metric every trader should know

Understanding a better substitute for win ratio and profit/loss ratio Like any other business, successful trading requires an analysis of our performance. While applying strategies in a backtest, in a forward demo test, or during live trading, we look at various metrics such as Net Profit, Win Ratio, Profit/Loss Ratio, Average Profit, Drawdowns, and so on. With so many metrics to look at, on which metric should we optimize our strategy parameters? Let’s discuss the two commonly used trading performance metrics, win ratio and profit/loss ratio, and a lesser understood metric called expectancy ratio. The latter is one of the…...