Using a hard stop in your trading? http://www.financial-spread-betting.com/strategies/stop-loss-strategies.html PLEASE LIKE AND SHARE THIS VIDEO SO WE CAN DO MORE! We need we need to use stops in our trading. But we have some options - in this video we are going to talk about a hard stop i.e. a fixed stop amount in pips or points. If we're day trading the DAX we could have a hard stop of 20 points. If we're day trading the EUR/USD we could have a hard stop of 15 pips. The advantage of this is that you always know where you are and you know approximately your maximum loss (amount at risk) in advance. The downside is that market conditions change even on a day-to-day basis. One day we could have a low range, the next day we could be shooting off the stratosphere with a subsequent retracement during the end of the day..etc The trouble with a fixed stop strategy is that you're not adjusting for volatility. And as the risk increases (i.e. volatility increases) so the stop size has to increase. Of course you can also reduce the position size.
