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Strategies & Market Trends : Charts for Breakout -- Ignore unavailable to you. Want to Upgrade?

To: djj who wrote (263)	7/8/2000 2:45:01 PM
From: Julius Wong	Respond to of 3506

Let's consider two investors, A and B. Both investors bought the same $10 stock, ROCK. Later the stock started to move lower. Investor A sold at $9. Then the stock dropped like a rock. Finally investor B sold at $5. For investor A the loss was 9/10 or 10%, to get even his next stock needs to move up 1/9 = 0.111 = 11.1%. For investor B, the loss was 5/10 or 50%, but to get even his next stock must appreciate 5/5 = 100%! It's easier to find a stock that will move up 11.1% than a stock that will double. To set stops at 7% or 10% is a choice, but the math is on the side of using stops. Julius