Hi Pat and Owen
I'll want to ask you, how to handle the stops after the second (additional 30%) or third (additional 20%) buy.
I understand, after the initial buy we keep our losses extremely small (max. 2.5%) according to several videos I found here. I learnt that a trade, that doesn't move up, is a bad trade. But I'm not sure how to act when it's acting correctly and I do the second and third buy. Where do I set the stops? Do I set several stop orders for each buy or do I use the average position price and set the stop 2.5% below this price? Or do I use a slightly wider stop due to the fact that the stock is acting right?
In the past I had often the problem, that more or less exactly when filling the full position the price turned around and I lost around 1% of my trading capital (according to the quite common 1% risk management rule).
Thank you for your insight!
Best wishes from Germany! Flo
1 Answers
Hi Florian,
Pat made this video for you:
https://youtu.be/ELX_ZsQyG7g
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Hi Pat
Thank you for the video. It answers my question!
P.S. Really like that you have a personal relationship to Germany!
P.S.S. It’s MR Florian 🙂