|
PureBytes Links
Trading Reference Links
|
George Tate wrote:
> Good afternoon........
>
> Trading INTC long today.
>
> I know it's a quick market but I've had stops at the bid price that were
> never executed in the past.
> So what's the floor procedure? Rules?
There isn't any stops with NASDAQ stocks. Many brokerages allow you to
place stop loss orders with them, which they execute as market orders if and
when the price reaches that point. Of course, slippage may occur, as the
current bid may disappear in the time taken to execute the order, or the MM
that is handling your order flow may not execute it at best bid (this
happens).
> I've traded for years and I view a stop as a cost of doing business so
> it's not a big deal.
> None the less I was curious about what other traders felt.
Limiting losses is a good idea, and placing stop orders is helpful to those
who aren't constantly monitoring their trades. There is a price to pay
though - first, it is not always best to execute at the market, and second,
you are tipping your hand to the MM. I'm not a big fan of fixed stops in
general, for a couple of reasons - support may be too far away, allowing you
to miss many otherwise good trades, and I've found that fixed exit points
(stops, targets) tend to be on the arbitrary side - and cannot factor in
performance the way that chart reading and TA wile a trade is in progress
does.
> I use Brown & Co. online and I'm pleased with them and have no
> intentions of changing firms.
Hey - you're pretty lucky then <g>. My advice though, if you are an active
trader, would be to investigate other firms anyway, particularly the ones
specializing in catering to the special needs of day traders, which Brown
and most other online brokers fail to do.
Regards,
A.J.
|