best way to use stop loss

What is the best way to use stop loss

I would like to know from experienced people who have used stop loss and benefited from them.

My question is what is the best way to use stop loss.
What is the best percentage to use in stop loss, one should use while selling and looking into the fluctuating indian stocks.
Would be great if you can explain with examples.

ashwn

Re: What is the best way to use stop loss

I am not that experienced trader but still I'd like to share my thoughts about SL:
1. Stop Loss is pointless, if not preceded by the word STRICT and followed by another two words: STRICT TARGET. Both these should flash in your mind before you buy shares.
2. Never enter the SL in the computer if you are glued to your seat. But do enter it if you are to leave the screen for a long while, or the market is chaotic and volatile.
3. There is no such thing as 'best' percentage. Best percentage of what? Of your capital, your savings in the bank, or the quantity or the price of the scrip? Ask yourself these questions, and you'd see it's all dynamic - not static. Yet if you still want some kind of a soothing lolipop then it should acedemically be 1.5% of the scrip price. In reality, the percentage is directly proportional to the depth of your pocket - and to the intensity of your suicidal instinct.
4. Now, the example: The other day I bought 300 shares of [email protected]. Thoght I was riding the gravy train but actually I jumped in when it was on its way down! Before I could touch the keyboard, it was blinking at me @ 2367.10.
I waited it to move. It moved further down to 2366.40 then up 2367.45 then 2366.80, 2367.30... Getting out meant 1500-1700 loss. Staying with it meant, cat and mouse game till 3.30pm.
I got out in a blink. In the next minute I was buying 300 shares of [email protected] average. Took the delivery. Next day, the day before Diwali, I sold 200 of them @1100. You do the math.

Moral of the story: All words of wisdom, technical analyses, so-called years of experiences and what nots, are meaningless when the Market in its infinte wisdom decides to show its 'Virat Roop' like Krishna showed His to Arjun, just bow and go along its Will.

Happy Diwali to you.

Re: What is the best way to use stop loss

seems to me a wonderful phrase. thanks

Re: What is the best way to use stop loss

It is! I am a wordsmith - a writer.

Thanks

What is the best way to use stop loss

Is their anyone who can give there useful experiences on Stop Loss use and how it has benefited them on frequent use of Stop Loss.

I am not looking at other advices - just want people who are good at using stop loss to guide and benefit us all.

Re: What is the best way to use stop loss

did you read what I wrote? Or you didn't understand, brother?
I thought people in India knew English Language. You make me doubt it, brother. This 'Me, me...always me!' attitude of yours might get you some links to posts by generous people. But will you, with your 'Me, me...always me!' attitude get anything out of them? I doubt it.

Regards

P.S. Just to ask a tiny, little, ordinary question you started a new thread? That proves my point. 'Me, me...always me!' !!!

I don't think I should write Stop Loss is vital.

As Ravi said, stop loss could not be determined by your account size or something. Stop loss is dictated by the strategy you follow.

There is no fixed percentage of stops, it doesn't work that way.

You must use technicals to place stop that's appropriate to your entry,exit setups.

Unlike Goofy, I would suggest to put stop loss though you sit tight in front of your monitor. Markets may not give you breathing time when it comes for break outs.

Take Care

You are right, Mr. Gsalvadi. Only in part, if I may say so, sir. Sometimes there is sudden drop in realtime, which gets hardly refreshed on the screen, but enough to activate the trigger price which is already registered with the servers. By the time you realize, your stake gets sold.
Happened to me a couple of times. So I, personally, disist from entering it. Just to add a little: many newbee traders mistake STRICT SL means a fixed figure. Generally, I prefer it to be a fixed range of two prices. Say, 456 - 454. Enough to get you out manually. But I have failed in that many times also! Market sometimes do put you on a fast moving swing.

Regards

What is the best way to use stop loss

Thanks Ravi,

Can we use Trigger price to our advantage. For eg. a Rs. 100/- share has reached 105, means i am getting 5 % profit. Now the next day morning on opening it goes to 108, so can i put the sell trigger price to 106 and limit price to 106.
Will increasing my profit above the base price 105 by 1 % for a few days benefit me. So that i can reach upto say 8 % profit.

ashwn

Re: What is the best way to use stop loss

Thanks Ravi,

Can we use Trigger price to our advantage. For eg. a Rs. 100/- share has reached 105, means i am getting 5 % profit. Now the next day morning on opening it goes to 108, so can i put the sell trigger price to 106 and limit price to 106.
Will increasing my profit above the base price 105 by 1 % for a few days benefit me. So that i can reach upto say 8 % profit.

ashwn