Stop Loss - where to set it?

Prem · 18 August 2009

lols ok ic

motorway · 18 August 2009

motorway said:
Do you want mountains or molehills ?
Interesting topic

Such a stop loss is part of the entry
as a stop to opportunity cost/loss

Yes it stops loss
But it's true function is to

Maximize GAINS
By getting YOU OUT so you can GET IN

motorway

Yes it stops loss
But it's true function is to

Maximize GAINS
By getting YOU OUT so you can GET IN

motorway

white_goodman · 18 August 2009

Prem said:
by picking the stocks wisely i wouldnt have bought hih in the first place

now say i bought mqg at 60$ which i did

and then it went to 40$ (buy some more)

and then it went to 17$ ( sell my house and buy some more)

and now its $40 (sell some proportionally to how much you invested at each step) not all of it though, not yet

As long as the stock doesnt pack up ( hih, abs) then this strategy usually works

Im still new so be nice

black swans, they always happen

beamstas · 18 August 2009

white_goodman said:
black swans, they always happen

No
But they happen more than you expect!

trainspotter · 18 August 2009

You set it when you feel these things in the back of your throat.

nomore4s · 19 August 2009

Prem said:
by picking the stocks wisely i wouldnt have bought hih in the first place

now say i bought mqg at 60$ which i did

and then it went to 40$ (buy some more)

and then it went to 17$ ( sell my house and buy some more)

and now its $40 (sell some proportionally to how much you invested at each step) not all of it though, not yet

As long as the stock doesnt pack up ( hih, abs) then this strategy usually works

Im still new so be nice

What happens when you run out of money? Or the stock doesn't go back up to $40?

motorway said:
now say i bought mqg at 60$ which i did

and got stopped out for small loss

and then it went to 40$
and I bought many more BUT got stopped out for a small loss again

and then it went to 17$

And since I had lots of cash I bought 3.5 times more than I ever thought possible..

and now its $40

I might buy an Island and retire

motorway

lol, exactly

tasmanian · 19 August 2009

motorway said:
now say i bought mqg at 60$ which i did

and got stopped out for small loss

and then it went to 40$
and I bought many more BUT got stopped out for a small loss again

and then it went to 17$

And since I had lots of cash I bought 3.5 times more than I ever thought possible..

and now its $40

I might buy an Island and retire

motorway

absolute gold!!!!!

Prem · 19 August 2009

Quick question

once you get stopped out

how do u know when to get back in >?

Aussiest · 19 August 2009

motorway said:
now say i bought mqg at 60$ which i did

and got stopped out for small loss

and then it went to 40$
and I bought many more BUT got stopped out for a small loss again

and then it went to 17$

And since I had lots of cash I bought 3.5 times more than I ever thought possible..

and now its $40

I might buy an Island and retire

motorway

This is all very well, (and so is tech's chart), but in an ideal world, when do you know when to get back in? What if the guy got stopped out at $17.00 and then kept getting stopped out all the way up to $30.00 (even up-trending stocks swing around a bit), before giving up?

Mr J · 19 August 2009

Prem said:
how do u know when to get back in >?

When a situation develops that you can trade with positive expectancy. For example, if you follow trends, you'd wait for a new trend to develop.

motorway · 19 August 2009

Aussiest said:
This is all very well, (and so is tech's chart), but in an ideal world, when do you know when to get back in? What if the guy got stopped out at $17.00 and then kept getting stopped out all the way up to $30.00 (even up-trending stocks swing around a bit), before giving up?

With the example
it is possible a trader could have ( need not )
A working hypothesis

eg for xyz this stock will rebound for reasons abc

OK Hypothesis = a working guess ( technical , fundamental or hybrid )

Must be tested

Must look for disconfirmation
When there is none that is your entry

So the Chart is beginning and ending

When do you enter

When the chart allows you to
and the entry matters
as your post suggests

and while you were in cash maybe you did not buy mqg
But were making too much money to be worried. because you bought something else

To paraphrase someone else

everything works until it doesn't
The chart provides that answer

If there is no red light
then proceed with caution

When do you enter
when ( the very when )
It stops going down and starts going up...

( This is a defined entry )

Now this very when becomes a question of the scale of magnitude
you are operating on ( or want to )

So called long term is different to
short term

The hurdle at the turning point is different
This is about what size are the jumps you measure
( throw long ( or even all ) moving averages in the bin where they belong imvho )

http://www.clayallen.com/hypothesis testing cluster.pdf

motorway

Prem · 19 August 2009

how much does a stop loss cost ?

etrade?

tech/a · 19 August 2009

Prem said:
how much does a stop loss cost ?

etrade?

A lot less than not having one!

DocK · 19 August 2009

Prem said:
how much does a stop loss cost ?

etrade?

Comsec give the option of $9.95 pay up-front, or $14.95 upon being triggered - these amounts are min for trades up to approx $20,000. Not sure about etrade, but would assume similar? I've found the cost of the extra brokerage is less than the loss that would have been sustained without one

nomore4s · 19 August 2009

DocK said:
Comsec give the option of $9.95 pay up-front, or $14.95 upon being triggered - these amounts are min for trades up to approx $20,000. Not sure about etrade, but would assume similar? I've found the cost of the extra brokerage is less than the loss that would have been sustained without one

Get a decent broker, shouldn't cost you anything.

Maquarie Prime stops are free and the platform is heaps better then Commsec. It lets you set stops as well as limit orders that trigger when a price is reached, you can also short stocks.

Or if you are really serious about trading (as opposed to investing) Interactive brokers offers even more features as well as $6 brokerage on Aussie stocks as well as a range of other markets.

ThingyMajiggy · 19 August 2009

nomore4s said:
Get a decent broker, shouldn't cost you anything.

Reckon! Paying for stops, bugger that. Go with someone worthwhile. Paying for it would not be helping its whole purpose, to minimize loss, have to allow for the cost of actually having it too

Prem · 20 August 2009

nomore4s said:
Get a decent broker, .

Who do you recommend?

tech/a · 20 August 2009

IB is the best in my view but min capital is $15k US (I think).

You cant trade pretty well anything in the world and have all sorts of conditional orders.
$6 both ways for trades of $10K or less.
their TWS platdorm is fantastic.
But a real pain to set up an account.
Worth it though I like the security features.

skyQuake · 20 August 2009

tech/a said:
IB is the best in my view but min capital is $15k US (I think).

You cant trade pretty well anything in the world and have all sorts of conditional orders.
$6 both ways for trades of $10K or less.
their TWS platdorm is fantastic.
But a real pain to set up an account.
Worth it though I like the security features.

$3k for 21 or under.

Absolutely fantastic system. Has a bazillion different conditional orders all free.
Still cant believe commsuc and efail charge extra for conditional orders...

nomore4s · 20 August 2009

Prem said:
Who do you recommend?

Maquarie Prime or Interactive Brokers depending on your goals and trading/investing methods.

As Tech said with IB it is a bit of a process and min funds are required and with no chess sponsorship it probably isn't the best for longer term investing.

With Mac Prime brokerage is $20 min but has good features compared to Commsec & Etrade. Also gives you access to higher margin levels then IB.

Stop Loss - where to set it?

Prem

motorway

white_goodman

BOC

beamstas

trainspotter

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nomore4s

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tasmanian

Prem

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Mr J

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DocK

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ThingyMajiggy

Prem

tech/a

No Ordinary Duck

skyQuake

nomore4s

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