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Strategies & Market Trends : You buy a stock. It goes down, now what? -- Ignore unavailable to you. Want to Upgrade?

To: Investor2 who wrote (26)	7/7/1998 9:32:00 PM
From: The Ox	Read Replies (1) \| Respond to of 112

That's were it's very subjective. Alot depends on what I think fundamentally about the company. How do I view the investment, short, medium, long term. The shorter the term, the tighter the stop. Stops are also a good way of sticking to a trading regiment. Moving a stop up as your investment rises can be a useful tool to protect profits but can be dangerous with longer term investments due to the wash rule of 30 days. Short term, if you get stopped out of a stock, you can always buy back in. Longer term it may not be that simple. Being willing to lock in a loss to prevent a larger loss is not something alot of people feel comfortable with. Many won't want to admit defeat. I don't use stops too often. I think there are times when protecting your capital is more important then the long term potential of the investment. Risk tolerance becomes the key. What do you think?