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Technology Stocks : SSII - Info?
SSII 7.250-3.2%3:54 PM EST

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To: Dale Baker who wrote (18)5/9/1997 7:12:00 PM
From: MENSO   of 134
 
Hi Dale:

"Stop orders" could let you "sleep better" when you can only monitor the market for a couple of hours a day, but there is another downside to it that you did not mention.

Suppose you buy a security at $10 that has recently been trading at $15, and you issue a stop order to sell at $12 in order to lock-in your gains should it bounce a couple of points. What happens if news are released during the day that rapidly push it back up to $15 and your order executes at only ~$12 ?

Yes, it is a wise way to protect your investment. But it is also a way to limit your potential gains - specially if you are dealing with volative small caps.

That's my 2 cents anyway.....
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