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Taking Partial Profits: The Math Behind Selling Half

Partial profits mean closing part of a position at one target and letting the rest run. Many traders find it comfortable. The question is what it does to your numbers.

Suppose you risk 1R with a target of 3R. If you close half at 1.5R and the rest at 3R, your average win is 2.25R. If price reaches 1.5R and then reverses to your stop, you still make 0.75R on the half you banked, minus 0.5R lost on the rest, a net of 0.25R instead of a full loss.

The benefit is a smoother equity curve and less stress. The cost is a lower average win on trades that go all the way, which reduces the maximum payoff.

Whether it improves results depends on how often trades reach the first target and how many continue afterward. In a strategy where trades commonly reach the first level but rarely the second, partials help. In one where winners often run far, they cut the best trades short.

There is also a psychological point. A trader who feels secure after banking profit may hold the remainder through noise more calmly.

Costs matter too. Closing half a position means paying an extra spread.

Practical step: calculate your expectancy from your journal both with and without partial exits to see which number is higher.

Worked numbers. Risk 1R, target 3R. Close half at 1R and let the rest run to 3R. If both hit, you make 0.5 plus 1.5, which is 2R instead of 3R. If price tags 1R, turns and stops you out on the rest, you make 0.5 minus 0.5, so zero instead of minus 1. You're trading upside for smoothness. Whether that's worth it depends on how often your trades reach 1R and then fail. If your journal shows that happens a lot, partials help. If most trades that reach 1R go on to hit the full target, partials cost you money over time. Run both versions on your last fifty trades and compare the totals.

Whether partials help depends on your win rate and how often trades tag 1R and then turn back. Check your journal. If many trades hit 1R and come back, partials help. If most hit full target, they cost you. You need MFE data for this, the furthest each trade went in your favour before closing. Sort the trades into three groups: never reached 1R, reached 1R but not target, reached target. If the middle group is large, partials at 1R add real value. If it's small, you're giving away half of most winners for very little protection.