Important of using stop loss Levels - Page 487
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Thread: Important of using stop loss Levels

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    Lightbulb Important of using stop loss Levels

    Many traders think that its better not to use stoplosses because of their superior market analysis or their system.BUT one think they forget that the market not move what they think or analysis always they may be getting 90% success trade but non can give 100% in market.

    1- you can have a system that is 99% accurate and lose money.
    2- you can have also have one that is 1% accurate and make money.
    WHICH ONE DO YOU CHOOSE ?

    someone have said Trading is like HIGH WIRE ACT.

    you may walk the wire 100 times without a safety net but the it may happen that very 1st fall only kill you
    YOU CANT AFFORT TO TAKE THAT CHANCE.

    HOW TO MANAGE OR CALCULATE THE STOPLOSS AMOUNTS

    Amount to risk in one year - 100.000
    Monthly Stop Loss (Months in year) 5 - 20.000
    Weekly Stop Loss (Weeks in month) 2 - 10.000
    Daily Stop Loss (Days in Month) 8 - 2.500
    Per Trade Stop Loss 2 - 1.250

    ITS A WAY TO MAXIMIZING RETURN WHILE MINIMIZING RISK

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  2. #4861
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    Using stop loss is important, but when we have to deal with the market using high lot, we might think it is impossible, when the stop loss has been applied, it makes the trader to be calm when trading, the only exception where you will be restless is during high lot trading meaning you are afraid about what may happen to your account if the market does a spike or volatility suddenly increases.

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  3. #4862
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    There are many new traders trading without stop losses and the main reason is that they do not know where to place stop loss well. They have bad experience of placing stops and market triggers them and goes back. Traders should know that stop losses can be placed only in places where market will not go in normal market conditions.

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  4. #4863
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    Quote Originally Posted by Rola View Post
    There are many new traders trading without stop losses and the main reason is that they do not know where to place stop loss well. They have bad experience of placing stops and market triggers them and goes back. Traders should know that stop losses can be placed only in places where market will not go in normal market conditions.
    Then the trader is not yet serious about being a profitable trader and such trader will loss a lot of money before they know what is happening, I mean, we should get to use the risk management, furthermore here is no perfection and any one who thinks that the use of stoploss is not important, the trader is going to face a whole lot of margin call.

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  5. #4864
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    Clearly, if you ain't making use of the stoploss then it means that the trading account you are trading with ain't important to you, because the more we secure our trading account then it leaves us a more better chances to be able to trade some other times, losses is always part of the business. We should accept it and then get to have a means of making it lower.

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  6. #4865
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    To avoid unexpected loss that might be heavy we must protect our investment with stop loss, when we are trading with stop loss we will never lose big money to the market unexpected cause we will always lose the amount of money that we can afford to lose in the market, trading without stop loss is not a good thing to do.

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  7. #4866
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    Quote Originally Posted by stanlon View Post
    To avoid unexpected loss that might be heavy we must protect our investment with stop loss, when we are trading with stop loss we will never lose big money to the market unexpected cause we will always lose the amount of money that we can afford to lose in the market, trading without stop loss is not a good thing to do.
    You are absolutely right , the basic way to give protection to the trade account and our invested money through the stop loss is the well known process and the trader if they want to give attention on rightly use the stop loss levels then the problems about losses will be sort out so we need to pay attention on it and we must have good skills to prevent the losses .

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  8. #4867
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    Stop levels should be picked based on the trading systems we are trading with and the levels of the support and resistance because whenever you place your stop sat the wrong area then it is very much likely that the price would come back to hit it and then turns back to go in your direction. So the most important thing is to learn how to set the stop loss levels at the appropriate area where the price would be finding it so hard to come at and at the same time we should not risks more than the amount of money we have in the trading accounts.

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  9. #4868
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    Stoploss always protect our account from big losses , because if we do not use stoploss any position go against us will give us big losses , but with the help of stoploss with fixed level we had chances to exit from market in this way our risk should be minimum which we easily manage in our trade and will try to develop further best strategies .

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  10. #4869
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    Quote Originally Posted by tejaravi View Post
    Stoploss always protect our account from big losses , because if we do not use stoploss any position go against us will give us big losses , but with the help of stoploss with fixed level we had chances to exit from market in this way our risk should be minimum which we easily manage in our trade and will try to develop further best strategies .
    That is right and it can be known as a way to control the risks and all that. As so much as we want to become successful trader we need to know how we should make use of the risks management and stoploss is one of them which will help us become successful. If you don't know how to make use of stoploss and protect your trading account, you will get to loss a lot and even empty your account.

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  11. #4870
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    Stop loss is important thing that we need to consider in our trading at all time, because without stop loss we cannot survive in this business as much as we want, we need to place stop loss in our trade to prevent us from losing big money to the market in short time, we need to always make use of stop loss because it's the best way to protect our capital from big loss.

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