protective stop

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Protective Stop

An investment strategy designed to limit losses on a security by means of setting up a stop-loss order or stop-limit order. For example, a protective stop may involve an investor giving an order to his/her broker to sell a stock if its price drops more than 5% below what the investor paid. So, if the investor paid $30 per share, the protective stop would mean selling automatically if the price reached $28.50. Protective stops are risk averse and assume that if the price reaches (in this case) $28.50, it will continue its downward trend.

protective stop

A stop order that protects gains or limits losses of an existing investment position.
References in periodicals archive ?
Those stop/reverse lines are the exact prices where many professional traders place their protective stops to lock in gains and to exit a trade at a trend change.
Also, AlgoTrades adjusts protective stops and profit targets, uses advanced filters to monitor the market on a tick-by-tick basis carefully evaluating each entry, profit or loss, and stop placement level in real time.
Protective stops should be placed above a resistance level and I have the first level noted on this chart.
All Recommendations include Specific Entry and Exit Price Points with Realistic Protective Stops
Protective stops could be placed below support with targets to take profit set as twice that risk for our 1:2 risk:reward ratio.
Using the Elliott wave principal to find high-probability price targets and practice protective stops
Initial protective stops should be placed below support with target to take profits being set as twice that risk for our 1:2 risk: reward ratio.
Protective stops should be placed above resistance with target to take profits set at twice that risk.
Protective stops should be placed above resistance with profit targets set as twice that risk for our 1:2 risk:reward ratio.
Protective stops should be placed below support with limit orders to take profit set as twice that risk for our 1:2 risk:reward ratio.
Protective stops should be placed below support with the target set at twice the risk for our 1:2 risk:reward ratio.
Protective stops should be placed below support with limits to take potential profit set as twice the risk for our 1:2 risk:reward ratio.