Re: Re: [CANSLIM] Stop losses and DHI

From: Tomas <tomas986@yahoo.com>
Subject: Re: Re: [CANSLIM] Stop losses and DHI
Date: Mon, 9 Jun 2003 19:59:25 -0700 (PDT)
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Top of Thread: Re: Re: [CANSLIM] Stop losses and DHI Bill Triffet
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Bill,

I did not buy DHI, but had a position on VRNT, which
went down 12% last Friday(no stop loss order in
place).  I sold the stock this morning and actually
walked away with a 18% lost.  Post analysis:

1) BO on 6/3 with close $24.37 (Pivot point at
$23.95).  Put an order to buy on 6/3 that night.  6/4
morning, order execute at $26.21 (about 9% above pivot
point + .10).  Bought extended, should have put a
limit order instead of a market order?  But, if use
market order sometime will miss the boat on a good
stock...

2) On 6/6, stock went down $2.99.  Sold today at
$21.53.  Should have put a stop order when I bought
it?  Probably.

Final note, if I bought it right, at pivot point +
$.10, then I would still be in the stock today.  It
never actually go below the 8%.  I guess my trigger
finger is too slow, and need to be faster next time...

So, this is why I am trying to figure out what kind of
orders (stop/lost, market, limit,...) I need to do for
buys and sells.  It's kind of though, since every kind
of order has its pro's and con's.


Regards,
tomas


- --- Bill Triffet <btriffet@earthlink.net> wrote:
> Tomas,
> To this day the main rule I've never disagreed with
> WON has been "preservation of capital". " Live to
> trade another day" is the way to go.
> 
> Appling a trailing stop after you've made some gains
> may knock you out of the stock. Maybe it continues
> on up after that. Maybe not. The point is you live
> to trade another day. 
> 
> Maybe give yourself more wiggle room if a stock is
> ramping up quickly and you've made some gains.
> Example: 7% stop-loss right after your purchace then
> slide it up to just at or above the pivot after
> you've made say 10-12%. This is a very subjective
> thing but for me it satisfies two rules. 
> 1. Sell at 7% loss - no matter what.
> 2. Don't let a profit turn into a loss 
> 
> You didn't say when/where you bought DHI. How tight
> was your stop?
> 
> I have to agree with Mike that unless your doing
> thinly traded stocks or are making some LARGE block
> trades your trades are under the "big guys" radar
> screens. I recall WON mentioning the phenomina at
> one of his seminars but he does much larger trades
> than me...
> 
> --
> Bill
> 
> -------Original Message-------
> From: Tomas <tomas986@yahoo.com>
> Sent: 06/09/03 10:40 AM
> To: canslim@lists.xmission.com
> Subject: Re: [CANSLIM] Stop losses and DHI
> 
> > 
> > So, the question is does it happens often enough
> to
> warrent not using stop orders?  I guess this is all
> dependent on the investor, if he/she have time to
> monitor intraday action and the risk tolerance
> level.
> 
> 
> tomas
> 
> 
> --- michael_niemotka@baxter.com wrote:
> > 
> > I have also been stopped out in similar instances,
> > and I can only assume
> > that the specialists see large blocks at certain
> > price levels, because I
> > cannot believe that they would manipulate the
> market
> > unless it was really
> > worth the while.   My $1000 worth of stock would
> be
> > in the noise level if
> > considered on its own.
> > 
> > Mike
> > 
> > 
> > Mike Niemotka , PE
> > Sr. Principal Engineer
> > Baxter Healthcare Corporation
> > Route 120 & Wilson Road
> > Round Lake, IL 60073
> > Tel (847) 270-4075
> > Fax (847) 270-4525
> > michael_niemotka@baxter.com
> > 
> > 
> >                                                   
>  
> >                                                   
>  
> >                   
> >                     Ian <ianstm@shaw.ca>          
>  
> >                                                   
>  
> >                   
> >                     Sent by:                    
> To:
> >     canslim@lists.xmission.com                    
>  
> >                   
> >                     owner-canslim@lists.xm      
> cc:
> >                                                   
>  
> >                   
> >                     ission.com                  
> > Subject:     Re: [CANSLIM] Stop losses and DHI    
>  
> >                       
> >                                                   
>  
> >                                                   
>  
> >                   
> >                                                   
>  
> >                                                   
>  
> >                   
> >                     06/09/2003 11:50 AM           
>  
> >                                                   
>  
> >                   
> >                     Please respond to             
>  
> >                                                   
>  
> >                   
> >                     canslim                       
>  
> >                                                   
>  
> >                   
> >                                                   
>  
> >                                                   
>  
> >                   
> >                                                   
>  
> >                                                   
>  
> >                   
> > 
> > 
> > 
> > 
> > Hi Jerome:
> > 
> > I think that your specific DHI example is just
> plain
> > bad data.
> > 
> > As far as the market manipulation that you
> describe
> > - it occurs regularly,
> > although on a smaller scale, and with relatively
> > illiquid stocks. I have
> > never seen low-volume, stop-triggering moves from
> > $28 to $20, but I have
> > seen them from $8 to $6.50 and from $46 to $44 and
> > from $14 to $12 etc...
> > In these cases, it seems the market-maker or
> > specialist is content to allow
> > a market sell order to be filled at a fairly large
> > gap, which in trun
> > triggers stops, triggering more market sells,
> > exacerbating the price gap.
> > 
> > Extreme swings on low volume are not meant to
> > happen, as the mm or
> > specialist is obligated to keep an "orderly
> market".
> > Although, it seems to
> > me that "order" is in the eye of the beholder in
> > many cases.
> > 
> > At least 5 times in my life, I have had hard buy
> > stops triggered (on stocks
> > that I was short) at the highest tick of the day,
> at
> > a price $0.50 - $1.00
> > higher than than the range where the shares traded
> > almost all day. In all
> > cases, it appeared to me that my particular stop
> was
> > targeted and run ...
> > although the market definitely is a fertile ground
> > for breeding paranoia :)
> > 
> > Cheers,
> > 
> > Ian
> > 
> > 
> >  ----- Original Message -----
> >  From: Jerome Buckmelter
> >  To: 'CANSLIM LIST'
> >  Sent: Sunday, June 08, 2003 9:12 AM
> >  Subject: [CANSLIM] Stop losses and DHI
> > 
> >  WON does not like stop losses, but says for those
> > who cannot watch their
> >  stocks, it..s okay.  But is it?  What are the
> real
> > pitfalls with stop
> >  losses? I am concerned with what happened to DHI
> on
> 
=== message truncated ===


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