STOP-LOSS

22 March 2017 By PDSNET

Once a share that you have bought is "in-the-money" (i.e. your stop-loss level has moved above the price you paid for the share), then you can apply a "target percentage growth line". What this means is deciding on how much you want to make every year in percentage terms and then adjusting your daily stop-loss level by that amount to ensure that you can achieve your goal. For example, let us say that you decide that you want to make 50% per annum, then you simply divide that 50% by the number of trading days in the year (about 250) and that will mean that you must increase your stop-loss level by 0,2% (50%/250) per trading day. That then becomes your target stop-loss.

A Target Stop Loss
Target Stop Loss



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