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Online Share Trading

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improving stop loss triggers?

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waitandsee
Occasional Contributor
A problem with stop loss triggers on low volume shares is that some small "ridicules" trades will activate the trigger although the general trend of the share price does not support "bailing out". For example: on 07 Jun 2012 at 16:18 the price of ARB declined by 25% in 1 minute only to recover by 20% in the next 4 minutes! Can anyone suggest ways that OST can improve the triggers? Maybe by taking volume into account? Or some kind of delayed mechanism? Last 30 trades : ARB # Traded time Quantity Price (c) Value (R) 1 07 Jun 2012 17:00 86,993 350 304,476 2 07 Jun 2012 16:22 200 335 670 3 07 Jun 2012 16:18 20,000 290 58,000 4 07 Jun 2012 16:18 66,993 270 180,881 5 07 Jun 2012 16:18 400 300 1,200 6 07 Jun 2012 16:18 7,807 320 24,982 7 07 Jun 2012 16:18 204,800 355 727,040 8 07 Jun 2012 10:53 200 355 710 9 07 Jun 2012 10:52 95,000 341 323,950 10 07 Jun 2012 09:00 5,000 341 17,050
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4 REPLIES 4
SimonPB
Valued Contributor
that's the problem with low liquid shares.. not a heck lot one can do expect place an alert instead of a stop loss and action the alert - which requires discipline ..
bigger question, are you trading or investing in ARB? As investor I don't use price stops, rather fundamental stops ..
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superstar
Regular Contributor
If you investing (especially small caps) short term price movement should not worry you. Yes we get excited when a small cap goes from 9c to 21c but if its short term it should not matter as the other way round can be true. If the stock has fundamentals and long term possibilities that is all you need. Any changes to those key fundamentals should be used as exit possibilities.
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SimonPB
Valued Contributor
an a volume filter wouldn't have helped, the trade that hit 270c was in total almost R1m
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waitandsee
Occasional Contributor
Thanks for the comments, in future i will stick to "non selling" alerts.
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