Truths about Stop Losses That Nobody Tells You!

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Is utilizing stop loss orders for the average trader a good or bad idea? Andre Minassian, self-employed medium-term trader and businessman comments. Why are stop losses the main reason for being taken out of the game? What methods do you employ to minimise losses? How do you determine if a trade has failed other than its performance after entry? I am definitely against using tight stop losses. I do utilise stop losses but my stops are not tight at all.

[ukspreadbetting]

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[petavgeris]

I have been trading for more than 15 years. I can guarantee you that the single greatest error that a trader can do is to ignore the risk he is willing to take. Risk management necessitates the use of stop loss orders, either inserted into the platform or mental, it is the same. Ignoring risk leads to catastrophic losses. It is not related to 'if' but only to 'when'. It is simply a matter of time when exactly you will be blown out. If you are constantly stopped out, then it is absolutely certain that you are doing something wrong with your risk management. It's not your stop loss orders that are wrong and need to be omitted, it is your whole strategy that requires amendment.

[ukasiaForexTrader]

Many words of wisdom.
I blew up a few accounts when I started out by trying not to lose.
Became profitable once I realised and accepted that I needed to learn to lose before I could win.
Sounds nonsensical, I know but it is a fact.
Another gem was learning that successful trading was not about being about doing the right thing by sticking with your trade plan and your strategy. You will have losses and you have to accept them.

[thestream]

If you’re a Scalper you can’t afford not to use a tight stop loss.
If you’re a Swing trader, this may work for you. I think it depends on what kind of trader you are.

[TheAnical]

If your in profit, place a stop-loss...

[IknowIamafool]

The day I removed the stop loss from my trading was the day a new world opened in front of my eyes.

[slnhn]

The best way to protect your trades is by keeping a low lot size. So when it goes against you, like way against you, you can still weather the long storm and wait for it to come back. It isn't about stop losses, it's more about lot sizes.

[mostresticator]

Stop losses are advertisements for the institutions. You're showing them where liquidity is and they will move price to snatch you up. Chances are you're putting the stops where most traders put theirs and when the big boys see batches of liquidity above or below support/resistance, it's a perfect opportunity for them to do their business efficiently.

[tomb]

Agree with this 100% Too many times got taken out with a stop loss, only for the market to go back in the trade's favour.

[truthseekerv]

I don't use stop losses at all!!! When I stopped using stop losses, I finally started making money.

[aleksmartini]

2:50 “I go all the way in” then the look from the lady

[williamrunsatlanta]

VERY true, instead of placing an unrealistic tight stop loss, just reduce your share size and allow your trade room to swing back and forth. Your stop loss should always be based on previous support or resistance and those are not always in a tight range.

[enditakamweneshe]

Stop losses should only be used when you are not actively watching your open trade, if you are at your computer or phone watching your trades then there is no need to have stop loss points.

[mrebholz]

Best stop-loss is your interior hope 🙏indicator: as soon as you start hoping --> run, as fast as you possibly can. 🏃 💨

[Therealltaken]

With 3 years of Live trading, he is totally correct

[Jbank]

I have personally papertraded the exact same stocks at the exact same time on different platforms. I have found that it is true. It took me years to break this habbit because it was one of the first things I learned. You manage risk by your position size.

[arthouston]

Institutional traders will try to sweep out stops that are placed too close to the traffic, so you need more room to stay in the action.

[InnateWhisper]

Your stop loss protects your account from blowing up. If you have even a decent algorithm that you test over and over you shouldn’t hit your stop loss often at all, even while keeping your risk at or below 2% of your account. If you keep getting stopped out, the problem is your system, not your stop losses. If your stop losses truly are “too tight”, then your actual problem is money/risk management.

[alexandercripple]

I thought I was an irresponsible madman because I average down my stop losses and keep an eye on the chart doing that manually, finally someone that made me feel less alone at the battle field, thank you Mr.

[xptweak]

For scalpers tight stop loss is essential