Stop Losses Are For Whimps!!!!!!

[mhorro]

Take a deep breath before you reply!

I now set my stop losses at double digit tick sizes, why?

I got cheesed off getting closed out when I was right about the market move.

Now I feel more relaxed about trading as if I get it right more times than wrong I make money!

Tight stop losses were causing me grief.

We need to be pretty confident before we enter the trade and not rely on the safety net of a stop loss.

Thanks.

Mark

[Derek27]

Take a deep breath before you reply!

I now set my stop losses at double digit tick sizes, why?

I got cheesed off getting closed out when I was right about the market move.

Now I feel more relaxed about trading as if I get it right more times than wrong I make money!

Tight stop losses were causing me grief.

We need to be pretty confident before we enter the trade and not rely on the safety net of a stop loss.

Thanks.

Mark

It's a bit ironic to say stop losses are for wimps but then say you set stop losses, albeit double digit tick sizes.

I've never used stop losses for the very reason that you give. Horse-race markets are too volatile/noisy for them - if a horse moves ten ticks in a few seconds, it could just as easily move twenty ticks in the other direction, so when I tested them they often fired when I could have managed the trade better manually. They are also useless in low liquidity markets where they can be triggered simply because nobody's offering money in the market.

However, I only trade horse racing. I don't know what other sports are like so I wouldn't say they are useless - I just haven't found a situation where I'd find them useful. The important thing is to have a stop loss, either automated or in your head. The advantage of having stop losses in your head is that you can adjust them according to what's going on in the market.

[ShaunWhite]

Originally stop loss limits were all about having a safety net so you could sleep or eat and weren't generally used if you were sat at your desk. I treat BA ones similarly, if I'm sat there I don't need it, but if I need to answer the door or see what the dog's barking at I'll use one in case anything odd happens.

The one time I'd really like to define a stop is when I want to go look at different markets especially if you're taking earlier longer term positions. Persistent servants would be a nice solution to that one and many other watch and wait situations.