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<FONT face=Arial color=#008080
size=4>Chuck
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It
would be great if you could write a book just on stops. This would include all
types of stops including the inactivity stop. Although I have read your material
on ATR's I still do not have a good feel for them and exactly how they should be
used and with what parameters. Should values be different for low and high
volatility stocks as well as MFs and ETFs or does ATR take care of
this?
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I also
used two types of trailing stops. One is a protective stop order that I change
daily, is looser, and can be triggered by the low of the day. The
other is based on the close of the day. Should these be approached differently
and with what ATR value? Would it be better to place the protective stop order
based on lows?
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There
is no book like this and we need one. Of course any insight would be appreciate
here and now.
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<FONT face=Arial color=#008080
size=4>Thanks, neo
<FONT face=Tahoma
size=2>-----Original Message-----From:
owner-metastock@xxxxxxxxxxxxx [mailto:owner-metastock@xxxxxxxxxxxxx]On
Behalf Of CRLeBeau@xxxxxxxSent: Saturday, March 17, 2001 6:05
PMTo: metastock@xxxxxxxxxxxxxSubject: Re: Profit
StopsIn a message
dated 3/17/01 9:13:57 AM Pacific Standard Time, neo1@xxxxxxxxx writes:
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FAMILY="SANSSERIF">
<BLOCKQUOTE
style="PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #0000ff 2px solid; MARGIN-RIGHT: 0px"
TYPE="CITE">Any thoughts on this?<FONT lang=0 face=Arial
color=#000000 size=3 FAMILY="SANSSERIF"> <FONT
lang=0 face=Arial color=#000000 size=2 FAMILY="SANSSERIF">I like to move
my stops closer as the profits get larger. This allows me to have
fairly wide stops at the beginning of a trade (the wide stops at the
beginning of a trade give a higher winning percentage) and then I try to
maximize the size of my winning trades by moving the trailing stops closer
so I give back less of the open profit. This strategy is for trend
following type trades. For counter-trend trades I just use
a profit target and when I see the profit I take it. I have found
that counter trend trades generally tend to produce profits in the
neighborhood of 1.5 to 2.0 ATRs. For trend-following trades I try to
tighten up my stops after 4 ATRs of profit and then hope for more. I'm
leaving for New Zealand this weekend to do a TraderCamp in Vanuatu with
Dr. Elder so I probably won't be able to answer any e-mail messages while
I am out of the country. I'll be back in the office in April.
Chuck LeBeau www.traderclub.com
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