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LEVEL 4 · Building a Market-Study Workflow · LESSON 18

The R-Multiple Risk Framework

📖 Written guide

Use a pre-defined 1R unit to record planned risk and review outcomes consistently.

An R-Multiple expresses an outcome in units of risk defined before an exercise or trade. It gives records a common scale; it is not a return target or promise.

Key concepts

R and 1R
R is the pre-planned risk unit for one position. 1R equals that planned risk amount.
2R
Two units of the defined risk, used to describe a recorded multiple rather than recommend a return.

Learn it step by step

  1. 1Example: with a $10,000 account and 0.5% planned risk, 1R equals $50.
  2. 22R is $100 in this example; it describes twice the risk unit, not a suggested result.
  3. 3In a review log, record the planned and observed result in R units and note execution differences.

No fixed return rate is recommended. Actual outcomes may differ from the plan.

FREE TOOL FOR THIS LESSON

Risk Calculator

Review Max Risk and the risk estimate for one contract.

Open tool

Education note

This lesson covers NinjaTrader software, chart tools, market analysis, and risk-management concepts. It does not provide trade signals or return promises.