Paul Brian A830 Jones

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How do profit factor and expectancy guide forex performance evaluation?

Profit factor is the ratio of gross profits to gross losses, while expectancy measures average return per trade. Institutions use these to judge if a system has a sustainable edge. For example, a profit factor above 1.5 is generally strong. Retail traders benefit from expectancy because it shows long-term viability, not just win rate. Benefits: clarity about whether trading is worth pursuing. Risks: high profit factor on small samples may mislead. These metrics force traders to think probabilistically: it’s not about one trade but the average outcome over hundreds