How much you expect to gain for each unit you risk. A 1:2 ratio means winning twice what you risk.
It is calculated by dividing the distance to take profit by the distance to stop loss. With a 1:2 ratio you only need to win about 34% of the time to break even (before costs).
The ratio alone does not tell you whether a strategy is good: it must be combined with the win rate. Together they determine expectancy, the average amount you win or lose per trade.