"Why don't you use trailing stop loss?" one reader asked.
This is two weeks ago.
"They are not suitable for my strategy," I replied.
I understand that I have asked this question many times now, and they are shocked whenever I tell others that I don't use them.
You see, for me, the trailing stop loss is out of date. When the market is run by humans and the bid-ask spread is greater, they will work.
But today, computer programs and algorithms run on the market. The bid-ask spread is sometimes only one-tenth of a penny.
In addition, some stocks are basically not traded except for opening and closing.
I will tell you why these different things make trailing stoppages obsolete, but first, let me explain what they did...
Trading at the speed of light
Trailing Stop Loss is an order to sell stocks when the stock falls by a certain percentage.
For example, when the stock price falls by 10%, many people will sell one stock. In that case, they will lose a position before losing money...
Orignal From: Traders are looking for your trailing stop loss
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