To use or not to use? (Stops)

[ronin266]

Quote from justrading:

Good point. I always thought Stops were held on my PC but a little checking reveals that for CME at least, stops are held at the exchange.

I use Ninja Trader and the cancellation instruction for OCO has to come from my PC, whilst the 2 orders reside on the exchange servers. Theoretically if I lose the connection, both orders could be filled.

Thats at the same time their problem, you show the market where you will give your part away :/.

Is there any platform that puts automatic stops orders? I use sterling but you only can configure it to automatically add trailing stops to your orders, but they´re only stored in their server, not on the exchange itself. That way one could add automatically "emergency" stops like half point below your entry point in case of a major issue.

 

[justrading]

Quote from ronin266:

Thats at the same time their problem, you show the market where you will give your part away :/.

Is there any platform that puts automatic stops orders? I use sterling but you only can configure it to automatically add trailing stops to your orders, but they�re only stored in their server, not on the exchange itself. That way one could add automatically "emergency" stops like half point below your entry point in case of a major issue.

I am not aware of any. For Ninja Trader the basic orders reside on the exchange server, but OCO and Advanced Trade Management instructions are on the local machine.

 

[Visaria]

Quote from emg:

visaria! where have u been? have some mojitos at volente bar and grill

http://www.elitetrader.com/vb/showthread.php?threadid=228624

Thanks, will pop in!

 

[fullautotrading]

Quote from ronin266:

Are the stops helpful or they will just drag you down?.

I´ve been trading since 2006.Had bad times, had really good ones, now its something at the middle.
...
My idea now is to open positions without stops, but when a decent profit amounts (20c or more) only then put a stop. So as the market already moved a lot, it would not be profitable to specialists, your b/d (in case that the order flow is not fully internalized), and other participants with the ability to see the stop, move the price against you to get the shares.
Or, start scalping, so my couple thousand shares desn´t attract anybody.

A stop is like a "take profit" with a negative amount.

If the negative amounts you accumulate exceeed the positive ones, it's not going to be so good ;-))

Some agv up/dn with options will usually do a better job, for discretionary trading...

T

 

[SteveNYC]

I think you make more money if you don't use stops.

 

[ExchangeBonds]

Over time, you will get a feel for when your stops are likely to get hit or not. Almost all my trades I will get out of before a stop is hit. I think a stop should definitely always be placed just in case of some power outage, emergency happens, or some random news event that might screw your position. Are stop market orders necessary to get out of trades, no they aren't, but I wouldn't really want always trade with no protection. You could also be like emg who suggests using 500k to trade a 70-100k contract. I've yet to hear of someone who trades futures instead of stocks that uses no leverage though.

 

[ronin266]

Ok, second week trading without stops.

As I predicted, overall trading improved. I watch the positions and now "feel" when things aren´t going as expected, so I just jump out of it with a limit or market order (Like 70-80% of times prices ended against the position just after I closed it).

Now I noted that there are real movements to get the stops. Yesterday for example, I was 15c + in a position 400 shares, but other stocks started to move, so I decided to put a stop 5c below market to watch the other issues, as soon as I sended the order, bids started to dissapear, and price to fall. I canceled the stop, and everything gone back, the rally continued for 10c more, I jumped out with a limit when moment was near to the end. This situation has happened 4 times in this period. I do not think that it´s just a coincidence. These orders are visible to someone out there, and he is using that advantage.

Other thing that I noted, is that I have more "power" in the markets that I was thinking before. Earlier, I would enter a position, put a stop and let the market take care of it. But now that I´m following the action, I saw that I can help the move to go in my favor. Even a 100 order can move a price level when other players do not want to participate. Haven´t explored this in detail, but I´ll start to experiment with this as the opportunities arrive to watch this. Now the market is more alive than I thought before, and it responds to every external force, no matter how small it is.