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Gains are what ultimately drives profit, but keeping the losses at manageable levels is very important too. Keeping those losses at the manageable levels really factors in 2 things: The RV and historical performance analysis identifies trade candidates where larger losses are the exception - and it will take RV drops significantly higher than averages to cause the outsized loss (which unfortunately does happen from time to time). Risk vs Reward - the SO trades are structured so that they can easily make as much (or more) than they can lose, so its easier to recoup losses from losing trades. Trade structures where you risk $5 to make a max of $1 are those than can kill you when the stocks do the wrong thing and get you closer to that max loss level, so you need multiple winning trades to recover from one loser. @Yowster