I truly hate STOPS. One has to ether made them so loose that
they represent an uncomfortable loss or one has to endure losing
ones position when trading slows and the price jumps up to clean
out all the pending stops, usually just before moving in the other
direction.
I think what is needed here is qualified stops. Stops based on
price and volume or some other parameters. Examples could be a stop
where a minimum amount of volume has to trade at that level or
better, or volume compared to average volume for the stock. I know
that ATR stops are common but I am not sure they help solve the
problem.
Anyone have any experience or thoughts on SMART STOPS?
Posted by tsurplus on 28th of May 2015 at 01:22 pm
basically stops = no free lunch.
you can make the stop loose, but that means bigger stop
losses.
yes, it is very frustrating to get whipped around.
My experience with stops has been that if I keep it too loose,
it ended up being a much bigger loss than I had planned for,
because once it gets loose, there is an urge to "may be give it
more room and it will come back"... well, sometimes it does, many
times it does not.
-- confessions of a wanna-be-trader
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I truly hate STOPS. One
Posted by jroger on 28th of May 2015 at 12:05 pm
I truly hate STOPS. One has to ether made them so loose that they represent an uncomfortable loss or one has to endure losing ones position when trading slows and the price jumps up to clean out all the pending stops, usually just before moving in the other direction.
I think what is needed here is qualified stops. Stops based on price and volume or some other parameters. Examples could be a stop where a minimum amount of volume has to trade at that level or better, or volume compared to average volume for the stock. I know that ATR stops are common but I am not sure they help solve the problem.
Anyone have any experience or thoughts on SMART STOPS?
there is no free lunch
Posted by tsurplus on 28th of May 2015 at 01:22 pm
basically stops = no free lunch.
you can make the stop loose, but that means bigger stop losses.
yes, it is very frustrating to get whipped around.
My experience with stops has been that if I keep it too loose, it ended up being a much bigger loss than I had planned for, because once it gets loose, there is an urge to "may be give it more room and it will come back"... well, sometimes it does, many times it does not.
-- confessions of a wanna-be-trader