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Thread: Profit Stops

  1. #1

    Lightbulb Profit Stops

    Hi all, wondering if it's worthwhile using Profit Stops/Triggers and what %increase in a share would you think worthwhile to then activate these?

    Realising that a single stock can have varied degrees of Price Movement throughout the day, i'm looking at a 'generalisation'..

    I.E- if a share you hold rises 15%-20% say from 0.44 to a range up to 0.50-0.55 on a given day, what would you set a Profit Stop at?

    Just activated my "Triggers" at Commsec and working out how to 'best' utilise them..
    The Barbarian Investor

    Price is What you pay- Value is what you get!

  2. #2

    Default Re: Profit Stops

    What Reward to Risk do you need to be profitable?

    Unless you know that a predeterined Exit % level will return you a profit over a period of time(Same as any exit method) you cant answer this question.

    If however you had a 2% stop loss on initial capital (There is a difference).
    You Won 50% of the time.
    Your maximum consecutive losses didnt exceed 25.
    Then 1.2:1 may work.Or 2.4% of initial capital profit.
    Change the stop and or % winners and or Transaction costs,everything alters.
    So if you choose a level and you dont perform EXACTLY as the parameters you set youll go down in a heap.

    Really if your short term trading you MUST have a stop and it MUST be very close and you have to expect youll get taken out quickly.Its part of the Short term method Im afraid.

    Better email me for the worksheet!
    Attached Images

  3. #3

    Default Re: Profit Stops

    Same applies to a Trailing Stop which is what your refering to.

    Which chart?

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