Don't fret about it, these things happen from time to time, and
it's a low priced stock so it's gonna be volatile. For low
priced stocks you can have a wider stop, or one thing to do is to
check it pre market, and if it's gonna gap, you can always take the
stop off, then re-add it back sometime after the market opens and
then decide what to do.
For example, I place GTC buy stop orders in all the time for
stocks, however I make sure to check them in the morning, just in
case the stock is going to gap way up, I don't want the buy stop
order hit and I'm chasing a big gap up. For example let's say
I have a buy stop order in at $10, the stock is trading at $9.80
the day before, but the next morning the stock is trading at $11
pre market, well I'm gonna cancel that buy order so it isn't hit.
Also, getting stopped out is not a bad thing in trading, Steve
and I run into too many members here who buy a stock and never put
a stop in, then they hit us up asking who they should do as they
are down 30% on a position that went against them and they held it
down because they didn't have a stop, so they stayed in the 'hold
and hope mode'. Better to have a stop then not having a stop
because it instills discipline, which is important in
separating yourself from the 'masses'.
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Don't fret about it, these
Any thoughts on how to prevent this from happening again?
Posted by matt on 16th of Nov 2011 at 10:05 am
Don't fret about it, these things happen from time to time, and it's a low priced stock so it's gonna be volatile. For low priced stocks you can have a wider stop, or one thing to do is to check it pre market, and if it's gonna gap, you can always take the stop off, then re-add it back sometime after the market opens and then decide what to do.
For example, I place GTC buy stop orders in all the time for stocks, however I make sure to check them in the morning, just in case the stock is going to gap way up, I don't want the buy stop order hit and I'm chasing a big gap up. For example let's say I have a buy stop order in at $10, the stock is trading at $9.80 the day before, but the next morning the stock is trading at $11 pre market, well I'm gonna cancel that buy order so it isn't hit.
Also, getting stopped out is not a bad thing in trading, Steve and I run into too many members here who buy a stock and never put a stop in, then they hit us up asking who they should do as they are down 30% on a position that went against them and they held it down because they didn't have a stop, so they stayed in the 'hold and hope mode'. Better to have a stop then not having a stop because it instills discipline, which is important in separating yourself from the 'masses'.