Many people, after trading for a period of time, focus first on their win rate.

But there's a common pitfall here — a high win rate doesn't necessarily mean making money, and a low win rate doesn't necessarily mean losing money.
The key is how you understand and apply this metric.

First, let's talk about what win rate is.
Simply put, it's the proportion of profitable trades out of total trades.
The calculation is straightforward: number of winning trades divided by total trades, then multiplied by 100%.
For example, if you made 50 trades this month, with 30 profitable and 20 losing, your win rate is 60%.

It looks good at 60%, but that's not enough.
I've seen many people with win rates of 70% or 80%, yet they still end up losing money.
Why? Because they make very little profit on each winning trade, but lose a lot on each losing trade.
This involves another, even more critical metric — the risk-reward ratio.

What truly determines whether you can profit steadily is the combination of win rate and risk-reward ratio.
Suppose your win rate is only 50%, but each profit is twice the size of each loss (a 1:2 risk-reward ratio), then you can still make money in the long run.
Conversely, if your win rate is 80%, but your risk-reward ratio is 2:1 (losing more when you lose), you might also end up losing money.

Want to improve your win rate?
My advice is this:
First, every trade must have a clear entry and exit point and stop-loss, not based on feelings.
Second, maintain trading discipline and don't change your plan due to emotions.
Third, only open positions when there are clear signals; better to miss some trades than to enter randomly.
Fourth, strictly evaluate the risk-reward ratio of each trade; if the ratio isn't suitable, skip it directly.

Here's a practical tip:
Periodically download your trading history, carefully review which trades lost money, and identify common mistakes.
This process is very important because it helps you discover vulnerabilities in your strategy.
Many people skip this step, so they keep making the same mistakes without realizing it.

Finally, I want to emphasize that a high win rate itself is not the goal;
stable and sustainable profits are what truly matter.
This requires the perfect combination of win rate, risk management, and mindset.
Focusing only on the win rate can easily lead to confusion.