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Old 08-14-2012, 07:25 AM   #17

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Re: Why Do Some People Not Place Stops?

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Originally Posted by Jack Francisco »
... ...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..
If you follow the shenanigans of the high frequency trading firms you can see that stop losses can be very bad for you if you trade US stocks. Getting more and more common to see whipsaws due to rogue/stupid algos that take out stops and rebound to pre-whipsaw prices.

You can see lots of examples on premarketinfo.com where they follow (and hate) these guys.
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Old 08-14-2012, 07:51 AM   #18

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Re: Why Do Some People Not Place Stops?

You can use in-house stops or a equity-based stop loss (or take profit) that is monitored in-house by a script/expert advisor/etc. By keeping you stops off the exchange or off the broker server (forex), there is less risk of manipulation. The only real risk is that your platform/datafeed fails, in which you would have to call in to exit your position(s).
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Old 08-14-2012, 06:24 PM   #19

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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
There is a difference between the types of stops used to exit a market. And there are some basic reasons to not use stops. Now that does not mean you don't have some idea of where to get out. In fact the the biggest mistake traders make is to not define were they are going to get out or where to get out if they are wrong BEFORE they get in. I dont use the straight 2 point market order at an arbitrary price like others. If it goes against I look to see what the market is doing at the edge of my area. If its not looking promising (and by this time it should be clear) I press the close button. I have a cell phone just in case my net goes down.

Cut to the chase: Those guys that lost 8k on 1 trade either are trading with an account that is equal to you losing 8 bucks (no biggie) or they would of lost that anyway because you can always move your stop with a few clicks or tell the broker to cancel replace.
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Old 03-08-2013, 08:35 PM   #20

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Re: Why Do Some People Not Place Stops?

Many traders do not place stop oders but they already have plan their stop loss exit point/price. They prefer to execute their stop loss manually. When market reaches the stop loss order price it becomes a market order; in many cases the prices executed are not better prices but are the worst prices.
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Old 03-14-2014, 11:08 AM   #21

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Re: Why Do Some People Not Place Stops?

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Originally Posted by autotrader1 »
Many traders do not place stop oders but they already have plan their stop loss exit point/price. They prefer to execute their stop loss manually. When market reaches the stop loss order price it becomes a market order; in many cases the prices executed are not better prices but are the worst prices.
It could be like that, Or may be they want to cheat the broker and get the profit more huge..
For me, I always use stop loss, because its important and make more safe my account.
I've done lite this in liteforex broker for 5 years..
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Old 02-05-2015, 02:30 AM   #22

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Re: Why Do Some People Not Place Stops?

Trading without a stop loss is like driving without stopping at traffic lights. It may go faster, but you tremendously increase your chance of getting killed.
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Old 05-06-2015, 05:57 AM   #23

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Re: Why Do Some People Not Place Stops?

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Originally Posted by stefcio2002 »
Trading without a stop loss is like driving without stopping at traffic lights. It may go faster, but you tremendously increase your chance of getting killed.
Yeah quite accurate analogy. I always place stops in my trading, it's even done automatically by special software I found on FF.
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Old 05-06-2015, 11:30 AM   #24

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Re: Why Do Some People Not Place Stops?

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Originally Posted by stefcio2002 »
Trading without a stop loss is like driving without stopping at traffic lights. It may go faster, but you tremendously increase your chance of getting killed.
Minimal losses is the key. If you are putting size on from the start, then a good stop is important. If you are starting really small. then the stop isn't that big a deal if the amount risk isn't a risk to your existence as a trader.
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