Reward-to-risk and managing the trade

Entry gets all the attention, but most of a trade's result is decided by two numbers fixed before entry, the stop and the target, and by what you do while the trade is open.

How Live Flow computes R:R

R:R = distance from the price to Target 1 ÷ distance from the price to Support 1 (Resistance 1 for a bearish stock), rounded to one decimal and capped at 9.9.

Because both distances are measured from the current price, R:R changes every minute: it improves as price comes back toward the stop level and worsens as price runs toward the target. A stock that has already moved most of the way to Target 1 shows a poor R:R, which is the card's way of saying "the easy part is gone".

The win rate you need

If every win pays R and every loss costs 1, you break even when you win 1 ÷ (1 + R) of the time, before costs:

Costs and slippage push every one of these bars up (lesson 8). That is why many traders skip setups below about 1:1.5: at that point you need to be right most of the time just to stay level.

A useful habit is to think in R, where 1R is your planned risk on the trade. A loss at the stop is −1R; a win at a 1:2 target is +2R. It makes trades of different sizes comparable, and it is how the journal (lesson 11) measures you.

Managing an open trade

There is no single right way. These are the common approaches, with their trade-offs:

Approach	How it works	Trade-off
Fixed target	Exit everything at Target 1	Simple and repeatable; leaves big moves on the table
Partial exit	Exit part at Target 1, keep the rest	Locks something in; the rest needs its own stop plan
Trailing stop	Raise the stop as new levels form below price	Lets winners run; gives back some profit at the turn
Time stop	Exit if nothing has happened by a set time	Frees attention and capital; may exit just before the move

On Live Flow, Support 1 updates every minute. Some traders trail their stop to the new Support 1 as it rises; others trail only after Target 1 is reached. Decide which before you enter, and write it in your plan.

Rules that hold up

1. Never widen the stop. Moving it further away turns a planned −1R into an unplanned −2R or −3R. This is how the average loss ends up bigger than the average win, the pattern in SEBI's data.
2. Don't move the stop to break-even too early. It feels safe, but normal noise will often take you out of trades that would have worked.
3. Close intraday trades before the session ends if that is your plan. Brokers square off intraday positions near the close, often with an extra charge, and an intraday trade should not become an unplanned overnight one.
4. Re-check the market. If breadth flips or your sector turns, the reason for the trade may be gone even before the stop is hit.