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John, I know your answer is going to be unpopular with many on this
list, but I do whole heartedly agree with you. I have heard of "hard
stops" and "mental stops", but I have been taught that if you do not
have a stop in the market, you do not have a stop. Stops have cost me
money and position. Not having them have caused true pain!.
Al Taglavore
John Kosar wrote:
>
> Hi Joel.
>
> I've worked either on or near the trading floor most of my life.
>
> To me, to not use stops for fear of some local on the floor that's "out to
> get you" is ridiculous. Stops are your greatest money management tool, in
> my opinion. In the heat of battle when you are thinking "maybe I'll just
> give this position another 10 ticks", it keeps you disciplined and abiding
> by your game plan.
>
> The locals on the floor are looking for any advantage that they can get to
> make a buck. That's why they pay a half mil for a seat on the exchange.
> But any person who has taken a basic charting class can figure out where
> large accumulations of stops are going to be placed. My question is, if the
> market has taken out a key chart level against your position, no matter
> whether is was triggered by a local, a lunar eclipse, or just bad luck, as a
> technician do you still want to be in the position anyway?
>
> Stops keep you from making excuses as to why you were wrong, and keep you
> from losing your ass because of it. That's how I see it, anyway.
>
> As far as the type of stop, I'd say use plain stops (as opposed to stop
> limits or stop close only), and trade in market that are liquid enough so
> the slippage on the stops won't knock you out of the game.
>
> John Kosar
>
> -----Original Message-----
> From: Joel Beck <beck@xxxxxxxxxxxxxx>
> To: meta <metastock-list@xxxxxxxxxxxxx>
> Date: Sunday, June 28, 1998 2:52 PM
> Subject: Using Stops
>
> >I would like to hear other's opinions on the pros and cons of using stops.
> I
> >understand that they are necessary to protect your profits and limit your
> >losses.
> >
> >However, I've heard a lot of comments about how the specialists on the
> >exchange floors, use your stops "against you."
> >
> >I'm not sure what these people are talking about. Maybe some of you folks
> on
> >the list can expand on this subject, and give some advice on how to avoid
> >this if it is happening as well as open a dialog as the the various kinds
> of
> >stops that people use/prefer and the reasons why.
> >
> >Thanks,
> >Joel
> >
> >
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