Stop Loss - where to set it?

[Aussiest]

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.

I second that.

SkyQuake: lol @ efail. E*Trade used to mess up my orders on a regular basis, despite me telling them time and time again in their stupid customer service questionnaires.

 

[pedrod]

$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...

Etrade don't charge for conditional orders when trading CFDs. I would have thought Commsec were similar.

 

[pedrod]

Who do you recommend?

I used E*Trade, however have moved to IG markets. I was going to join IB, however they were$15k USD to start. IG are fantasticly quick and helpful at setting up you account. IG also have a trading platform called Tradecents that allows you to trade forex on very small amount to start with. This is very good to start you off.

However, when you are then let out into the real world of forex then the stake are higher and the loses can be greater and swift, as I have found.

IG also do CFD trades on ASX stock at around $7 or $8 per trade.

Account has no minimum balance or trade. THere may be a $1000 minmum to begin.

 

[nomore4s]

I used E*Trade, however have moved to IG markets. I was going to join IB, however they were$15k USD to start. IG are fantasticly quick and helpful at setting up you account. IG also have a trading platform called Tradecents that allows you to trade forex on very small amount to start with. This is very good to start you off.

However, when you are then let out into the real world of forex then the stake are higher and the loses can be greater and swift, as I have found.

IG also do CFD trades on ASX stock at around $7 or $8 per trade.

Account has no minimum balance or trade. THere may be a $1000 minmum to begin.

IG are CFD broker, IB are a real broker you trade the real markets. Not even close to being comparable imo.

 

[warezwana]

I dont use stop losses

Use or Lose
If you don't use them your winning luck at picking winners will run out and your Account balance will look something like this.... $0


(learn't the hard way) but I did learn

 

[Mr J]

I used E*Trade, however have moved to IG markets. I was going to join IB, however they were$15k USD to start. IG are fantasticly quick and helpful at setting up you account. IG also have a trading platform called Tradecents that allows you to trade forex on very small amount to start with. This is very good to start you off.

However, when you are then let out into the real world of forex then the stake are higher and the loses can be greater and swift, as I have found.

IG also do CFD trades on ASX stock at around $7 or $8 per trade.

Account has no minimum balance or trade. THere may be a $1000 minmum to begin.

Instead of worrying about getting the minimal account balance needed, worry about how much you need to trade with a decent chance of success. $1000 paying $7 or $8 per trade just won't cut it. Say you risk 5% per trade, you'd have to make 15% per trade just to breakeven. Even if you could beat that, you're making peanuts and placing large wagers relative to your capital (5% will see very large fluctuations).

IB requires $12k or so, but that's also about right. It's an amount that allows for reasonable commissions and for gains to be worthwhile. You don't even need to keep that amount there. IB also allows the trading of many, many markets - stocks (aussie and foreign), futures, options, forex, bonds etc.

 

[Prem]

No one still has answered my question

what if you get stoped out ?

when to buy back in ?

what if price dips below your stop loss

then rockets up again?

 

[Mr J]

No one still has answered my question

I already have:

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.

If you're looking for specifics, it's something you have to work out for yourself.

 

[Ardyne]

Prem, if you get stopped out you may never get back in. The trade is over.

Getting stopped out and having the stock rocket up the next day has hapened to nearly all of us. Its part of the business. Many times you'll get stopped out and the stock will continue down. I use prices below and above support and resistance lines respectively to set stops.

cheers

 

[nunthewiser]

Bought BBI today at 10 ........ stopped out at 9.8 ........ dipped to 9.7.maybe 9.6? flew straight past back to 11.5 /11 sell

gotta love trading

would love to meet a trader that this kind of thing never happens tho

 

[wayneL]

Bought BBI today at 10 ........ stopped out at 9.8 ........ dipped to 9.7.maybe 9.6? flew straight past back to 11.5 /11 sell

gotta love trading

would love to meet a trader that this kind of thing never happens tho

There are plenty of those around. They are called hindsight traders.

 

[CFD]

and those who get criticised for trading without a stop loss!

 

[Adam A]

Bought BUY at 0.032 x 110,000

Got stopped out at 0.037

Watched it go to 0.18c within in about a week

Painfull to watch but rules were reset this financial year

Plan the trade and trade the plan

Lost out on this one,but stops have saved me many many times

 

[tech/a]

Bought BUY at 0.032 x 110,000

Got stopped out at 0.037

Watched it go to 0.18c within in about a week

Painfull to watch but rules were reset this financial year

Plan the trade and trade the plan

Lost out on this one,but stops have saved me many many times

Change your rules.
Stops are to mitigate risk NOT profit!

 

[marknz88]

haha I think he just get his figures around the wrong way...:

 

[Adam A]

The stock went to 0.04 then dropped back down
Happened just prior to the run
Thanks for all the input on the thread, great reading

 

[tech/a]

So your trailing was a bit tight and your re entry wasnt in a plan.

 

[moXJO]

Any one read Larry connors where it has said stops actually hurt?

For many years, I advocated the use of stops in trading. If you look at any of my published work untill 2004, you will see the words "use stops" alongside most strategies.

In early 2005 we started running tests with the hope of identifying the optimal stop levels to use. What came back though was completely the opposite of anything we ever imagined.

It goes on to say they ran hundreds of tests that have shown the same type of behavior.


Test example given was stock above 200 day ma and closes at a 10 day low. The exit is a close above its 10-day ma, or when a stop hit x% below the entry

stop% ---trades---avg%profit/loss----avg bars held---% of win

none-----236237------.58%----------------7.74-------------69.81%
1 ------394480------.19%----------------2.89-------------26.89%
3 ------321824------.20%----------------4.11-------------47.31%
5------286991------.20% ----------------5.01-------------57.54%
7------ 268410------.22%----------------5.65-------------62.72%
10------253863------.27%----------------6.31------------- 66.55%
20------239605 ------.39%----------------7.26-------------69.35%
50------236337 ------.56%---------------- 7.70-------------69.81%

Book was written pre-crash.

 

[Adam A]

Thats correct Tech/a
Started going up and up and i didnt feel comfortable chasing it,ive been caught before doing this
Really was an amazing run up about 500% in a very short time
Not to worry,still learning, i guess the process never stops

 

[motorway]

Any one read Larry connors where it has said stops actually hurt?



It goes on to say they ran hundreds of tests that have shown the same type of behavior.


Test example given was stock above 200 day ma and closes at a 10 day low. The exit is a close above its 10-day ma, or when a stop hit x% below the entry

stop% ---trades---avg%profit/loss----avg bars held---% of win

none-----236237------.58%----------------7.74-------------69.81%
1 ------394480------.19%----------------2.89-------------26.89%
3 ------321824------.20%----------------4.11-------------47.31%
5------286991------.20% ----------------5.01-------------57.54%
7------ 268410------.22%----------------5.65-------------62.72%
10------253863------.27%----------------6.31------------- 66.55%
20------239605 ------.39%----------------7.26-------------69.35%
50------236337 ------.56%---------------- 7.70-------------69.81%

Book was written pre-crash.

Where is his re entry into the same stock or a different one ?

In Getting out the point is so you can get in..

I regard a stop loss as OFFENSE
it gets you out to get you in

You retreat before large forces of SUPPLY
only for one reason
TO ATTACK

OFFENSE IS OFFENSE
DEFENSE IS OFFENSE

Getting out of what could be good MAKES NO SENSE
unless you get into something BETTER

RETREAT is ATTACK
( IF OPPRTUNITY PRESENTS )


A test where in getting out you don't get back into something
IS no test..

because It Stops opportunity LOSS ( Yes as I said it stops loss too )

Please enter favourite military analogy "------------"

Many examples of retreat leading to victory (Or could have )
Must be many where NO retreat proved disastrous

Stalingrad anyone ?


Much to learn from Confederate Civil War General


Joseph Eggleston Johnston

directed a masterful delaying campaign against Sherman during his advance on Atlanta. However, his continued withdrawals raised the ire of Jefferson Davis, and he was relieved in front of the city.
His successor, John B. Hood, then began his destruction of the Army of Tennessee with reckless tactics.

Johnston would only engage against the superior forces of Sherman on His own terms He wanted to either ambush him or make him overextend his lines

He continued to use a stop loss waiting for the right opportunity to enter the fray...
He continually set ambushes and when they were avoided withdrew
If he never got the chance to attack he would have kept all his powder dry.
Because if his Army was destroyed there was no second chance
But with it intact... There was always a chance...

John B Hood stood and fought in series of charges
after which there was no more any army to Speak of, and Sherman marched to the sea...


Johnston was blamed for not attacking.. For continual defensive movements.
But that was wrong (imho ) He knew that the best offense was from defense
esp when the market can steam roll over the top of you like Sherman...

But The whole point of getting out was to GET IN
Not just to GET OUT

It is part of the ENTRY TECHNIQUE
you get out to get IN

You move left to move right
up to go down etc

motorway