Ryan & Beef

Monday – Friday | 11:30 – 11:45a CT

The Importance of Return on Capital and Risk vs Reward

Ryan & Beef

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

On today's show, Ryan and Beef explain the importance of focusing on return on capital and analyzing risk versus reward when setting up trades and constructing a portfolio.

The guys demonstrate trades with both favorable and unfavorable returns as well as how we think about our risk-reward profiles.

While we want to place high probability trades, it's important that we don't lose focus on how we're using our capital. Capital efficiency, risk vs reward, and favorable probabilities are all important ingredients for successful portfolio construction.

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