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Old 02-08-2012, 05:56 PM   #9

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Re: Why Do Some People Not Place Stops?

Some traders use a max loss limit set up with their broker instead of a stop order. This way they limit their risk to a percentage or a portion of their capital and not worry about having to maintain a stop during a trade and to prevent being wiped out during a unforeseen failure (data feed, computer, power failure, internet).
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Old 02-12-2012, 03:36 PM   #10

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Re: Why Do Some People Not Place Stops?

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Originally Posted by Octavian »
I keep reading of scenarios where someone has lost say $8000 on a trade gone bad or they ve got too greedy and i m puzzled as to why they just didnt use a simple stop to lock in profits?

Also why do people use mental stops rather than ones set with a broker ?

Stops seem to be the best defence a trader has at protecting their principal, nothing to lose yet plenty to gain
People are hesitant of taking stop losses as they think if they if they will take a stop loss they will realize their losses and floating losses are not the actual losses and this is not because of their greed but the emotional attachment with the markets and thinking of the markets will always move their own way ;-)
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Old 02-12-2012, 05:42 PM   #11

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Re: Why Do Some People Not Place Stops?

Quote:
Originally Posted by Steve66 »
Some traders use a max loss limit set up with their broker instead of a stop order. This way they limit their risk to a percentage or a portion of their capital and not worry about having to maintain a stop during a trade and to prevent being wiped out during a unforeseen failure (data feed, computer, power failure, internet).
This is a good tip for those trading futures.

Note that if you're in the uk and using financial spreadbetting, you will struggle to get a spreadbetting firm to accept an instruction to do this. Yes, they'll give you margin calls, but they'll often let your account run into negative equity if they think that you can afford to pay up. Many do, of course, offer guaranteed stops for a premium, which will do the same thing, or even allow perfect hedging, allowing you to be simultaneously both long and short a market.
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Old 02-13-2012, 02:43 AM   #12

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Re: Why Do Some People Not Place Stops?

Setting Stop loss is a good idea to preventing us from big loss but most of the traders go for mental stop loss while some do not prefer to use it. I think there is both pros and cons of of using stop loss.
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Old 02-13-2012, 06:06 AM   #13

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Re: Why Do Some People Not Place Stops?

setting stop levels is as important as picking entry and exit points for the beginners...the tool supposed to prevent you from big losses, may stop you from having profitable trades...
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Old 02-14-2012, 09:35 AM   #14

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Re: Why Do Some People Not Place Stops?

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Originally Posted by Obsidian »
setting stop levels is as important as picking entry and exit points for the beginners...the tool supposed to prevent you from big losses, may stop you from having profitable trades...
I have traded in Hangseng Index with Selling Stop . Don't have an idea about other products but strategy to trade with selling stop always pay me.

Selling Stop is not a bad idea but Beginners never understand selling stop. The best order to trade with is If Done order but there are only few brokers which offer If Done Orders and it is best match for the beginners.
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Old 03-31-2012, 03:49 PM   #15

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Re: Why Do Some People Not Place Stops?

I believe that my current experience in trading doesn't allow me to ignore S/L.

I've seen quite a lot of examples when people put orders without any stops and the next thing happening was upward/downward spike that eated all of the money.

Maybe sometimes I'll get into locks or other advanced techniques but for now s/l is the best way to limit my risk.
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Old 08-13-2012, 03:07 AM   #16

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Exclamation Re: Why Do Some People Not Place Stops?

I don't use traditional stop losses, though i had to reply, since i came on to ask a question regarding a trading problem i was having, and may have found the answer, then found this thread

At the very least, the value of maintaining a stoploss is to keep you -in- trades that you may want to be in for a longer term, but in the shorter term are going against you. As in, your system gets you in, and just as you do, the price consolidates. Without a developed stop loss method.. it would be too easy to exit these trades incorrectly, at least in my experience

I have been reading a few articles recently about how stop losses can be bad though... in the end, i think subjectively, leaving a trade alone like that, to actually rely on mechanical stop losses, is a bad idea in general. These are financial markets after all. Natural disasters happen, unexpected economic data comes out etc..
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