R is the amount you risk on a trade. If your stop would lose you $200, then 1R is $200. A trade that makes $600 is a +3R trade.

Why count in R

• It makes trades comparable even when you change size.

• It keeps your risk the same on wide and tight stops.

• It shows whether your edge is real, without account size getting in the way.

Sizing from R

Start with the dollar amount you are willing to risk on one trade. Divide it by the distance to your stop in dollars per contract. That gives you the number of contracts.

For example, with $300 risk and a 10 point stop on MNQ ($2 per point), each contract risks $20, so you can trade 15 micros.

How much is 1R?

Most professional traders keep risk per trade small, often between 0.25% and 1% of the account. Small enough that a losing streak does not change your decisions.

Tracking in R

Write every result in R in your journal. After 50 trades, look at your average win in R, your average loss in R and your win rate. That tells you more than your profit and loss ever will.

In HOC

Log your stop with every trade in the HOC journal and review your results in R, not dollars.