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I have been told that instead of using a fixed amount for a stop, place the initial stop at the point where you are absolutely certain you are wrong. I am not too comfortable with this since this can mean having a fairly wide stop. |
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If the stop has to be wide, then your position has to be smaller. It's that simple. If you have a small account and the stop you would use implies too much risk in the trade for a single unit position, then you are better off not taking the trade and waiting for another opportunity.
Traders often get fixated on having close stops because they think that means lower risk. That's not true. Closer stops are more likely to get hit by normal market action (noise), which actually makes them more risky.