Ive ranted about this in the past. Look here, few ppl are as ruthless in reinforcing risk management as I am. I turn every question into a RM question. So im ALL about stops. but if u think that just having a stop is the answer to risk management u're in for a surprise. why?

because PEOPLE CANCEL THEIR OWN STOPS !!! it drives me nuts when ppl think just having a stop will save them. Do u know how many ppl have a stop at 3.58, and cancel it when the stock starts to stall at 3.55??? or move it up to 3.65, then 3.70, then next thing u know it's at 4?

I even tell ppl to set max daily loss amounts with their brokers. But when it hits, they actually CALL the goddamn broker & have it removed! So stop thinking a hard stop is this magical thing that'll save u from ur own stupidity & stubbornness. A stop is only as good as your will

Too many people get lured into stubborn trades, and their excuse is always " dont worry, i ll use a stop". next thing u know they blow up b/c they either cancel the stops, reset it, or stop out and get back in the same trade 5 times in a row. death by multiple stop outs.

So i dont wanna hear this "i ll use a hard stop" bullshit. AVOID dangerous trades altogether unless u have the bankroll for it. period. so YES, i recommend hard stops, always have, always will. But i'd rather have u avoid the dangerous scenario in the 1st place.
#BearTipOfTheDay