What is take profit?

What it means

A take profit defines the reward half of the risk-reward ratio. Most systematic approaches place it as a multiple of the stop distance rather than at a round price, because that keeps the arithmetic of the system consistent regardless of how volatile the market happens to be that day.

Why it matters

The choice of multiple has a direct and mechanical effect on win rate. A target at twice the stop distance will be reached less often than a target at one times the stop, so a 2:1 system is expected to win less frequently than a 1:1 system and still make more money. Traders who judge a system by win rate alone consistently misread this.

What this changes in practice

Our engine fixes the target at 2.0 times the stop distance across every market regime. That is a deliberate simplification: earlier versions scaled the ratio per regime, and testing across 2026 and an out-of-sample 2025 period showed the scaling was fitting noise rather than capturing anything real. The strategy list records which ideas survived that kind of check and which did not.