Why is setting a stop loss important?
Setting a stop loss is like charting a course on a voyage, where each sailor sets sail with a different appetite for risk.
For the cautious mariner, a tight stop loss of around 5-10% ensures a swift retreat at the first sign of choppy waters, safeguarding their vessel from significant losses.
Meanwhile, the moderate navigator opts for a broader range, typically between 10-15%, allowing for some leeway in the waves while still steering clear of treacherous storms.
Lastly, the adventurous seafarer embraces a wider berth, with stop losses spanning 15-20% or more, embracing the thrill of high seas while acknowledging the potential for greater volatility.
Regardless of the chosen course, each sailor sets their stop loss with a mix of prudence, daring, and a keen eye on the horizon, ensuring they can weather any financial tempest that comes their way.
You might be tempted to keep your gains running since the market is rising, but it is never a bad idea to take profits whenever possible. Remember, it is better have some than lose some!
