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

To: PaddyD who wrote (42)	7/8/1998 6:14:00 PM
From: Bald Eagle	Respond to of 112

It was experiences similar to yours that caused me to stop using stop losses. I'm starting to buy protective puts instead. I hope they work better.

To: PaddyD who wrote (42)	7/8/1998 9:30:00 PM
From: Investor2	Respond to of 112

Your story is one I've heard before. Perhaps the mental stop loss approach is better. Best wishes, I2

To: PaddyD who wrote (42)	7/8/1998 11:06:00 PM
From: The Ox	Respond to of 112

Putting a stop less then 10% below your purchase price seems extremely tight for most stocks I follow. Again, this all falls back to my basic premise which is risk tolerance vs investment parameters/goals. Sticking to the original game plan is usually best. Whenever stops are in place overnight, you take the big risk of a one day event or early morning market jitter shaking you out. That's why I prefer to use mental stops as much as possible and if I'm unable to follow the market, I know in advance that my stop may do me more harm then good. That's the biggest danger in using stops, IMO. Sometimes it pays to be conservative. As I always say, if you can't afford to lose, don't buy a stock! Your better off with a different investment. If you can wait out an investment or have the will and deep pockets to chase the stock, that's a different ballgame altogether. I don't play options, so I have a different approach then many on this thread. Most of what I buy is for the longer term and I trade stocks only when the conditions are right with one of the stocks I follow. I only trade about 5% of my portfolio and leave the other 95% in long term core holdings. I've enjoyed reading about everyone's different investment styles. I track all positions sold vs current holdings for perspective. The stocks sold portfolio is down 25% and the stocks purchased with the proceeds are up 25% so the net result has been decent. Not bad over the last year, but not great. This is due in large part to the fact that I follow and trade a bunch of micro and small caps. As we all know, the smalls have lagged the entire market so it's been a little rougher on me.