Why to use STOPLOSS? - Blogs - Aussie Stock Forums

View RSS Feed

John Trader

Why to use STOPLOSS?

Rate this Entry
Click image for larger version. 

Name:	stop-loss.jpg 
Views:	101 
Size:	184.5 KB 
ID:	65179
As for futures, then this manipulation will hardly be painless. Unlike stocks, futures variation margin is deducted or added to your account every day. Therefore it is better to remove the methodology of withholding a losing position from your arsenal. Be sure to put stops! And always strive to ensure that your stop loss was very small relative to the profits that you can fix.

Always secure a loss if the position began to develop against you. You have to know in advance where your stop-loss will be located. Trading is a work with probabilities, so if the price started to go against you, then quickly close the position.

You do not need to prove to the market that you're right. It is better to fix a small loss and re-enter the position, but at a more attractive price.

I've got several friends who traded in market, going against them. Though they left the position open with the hope that the market after some time will come back. They hoped to close the position at least without any loss. Unfortunately, as a result, many of these people just closed position out of despair, fixing the loss of 40-60%. Some adjusted their deposit up to utter ruin.

So do not let the same mistakes. Always quickly accept your wrong. Remember that a small loss on the account that you see today may become a deep pit, from which it won't be easy to get out.


Submit "Why to use STOPLOSS?" to Digg Submit "Why to use STOPLOSS?" to del.icio.us Submit "Why to use STOPLOSS?" to StumbleUpon Submit "Why to use STOPLOSS?" to Google



Aussie Stock Forums