How To Effectively Use Stop Loss To Protect Your Capital And Lock In Profits

As mentioned in the earlier post, a Trading System should be able to answer the following questions:

a) What stock to enter.
b) When to enter (Entry strategy).
c) How much to enter per position
d) When to exit (Exit strategy).

While many people place too much emphasis on the entry, they don’t really know when to exit. Actually, a trader should focus more on exit strategy than on entry strategy. Exit strategy is much more important than Entry strategy.
There are 2 types of exits a trader must consider to be parts of his trading system:
* When to exit on your losing position (i.e. Where to put your initial stop loss).
* When to exit on your profitable position (i.e. When to take your profit).

Trader’s Blog has previously discussed further and even posted a video about various Stop Loss strategies to protect your capital and lock in profits effectively.
Check it out! Get more insights from the “Comments” below that article too.

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* Learning Charts Patterns