WHILE THIS IS A GOOD FORM OF RISK MITIGATION HAVING ITS MANY ADVANTAGES, IT ALSO HAS A COUPLE OF DISADVANTAGES THE INVESTOR NEEDS TO BE WARY OF.

Stop-loss order is wonderful risk mitigation tool that an investor can use to protect his or her portfolio. An investor who wants to limit his or her losses can activate a stop-loss order to cut investment losses from a drastic reduction in share price.

The investor simply informs his or her broker beforehand of the price rate or percentage that the stock price must drop to in order to initiate a sale. As such, where losses seem to be increasing as a result of a continuous downward trend in stock prices, an investor can choose a price that he or she cannot afford to go beyond.

When it hits the stipulated price, the broker then sells. While this is a good form of risk mitigation having its many advantages, it also has a couple of disadvantages the investor needs to be wary of.

Advantages of Stop-Loss Orders

It Is A Risk Mitigation Tool: Much like insurance, a stop-loss order is solely in place to limit the amount of losses you can make on an investment. This affords the investor a level of comfort or peace of mind where there is high price volatility.

It Is Cheap To Implement: Unlike many other risk mitigation strategies or hedging strategies that would cost something to implement, this order is as simple as putting a call across to your broker.

It costs absolutely nothing to implement. Regarding the commission, commission is charged when the stop-loss price has been reached and the stock needs to be sold.

Little Demand for Monitoring: A very common advantage is that the investor does not have to monitor stock performance on a daily basis. Monitoring your investment portfolio is a great idea; however, research shows that monitoring it makes you spend so much money.

It also keeps you constantly worried about the state of your shares which can force you to make a panic exit from the market. With a stop loss order in place, you can even travel out and relax without having to check your stock performance unduly.

Disadvantages of Stop-Loss Orders

Short-term fluctuation could be mistaken for a stop-price: This is probably one of the toughest challenges with the stop-loss order. Where there is high market volatility for a certain, the stop-loss order might be activated only for it to rise again.

At the end of the day, you might realize that you lost more than you gained from selling your shares abruptly.

No fixed rate or rules on where to fix the rate: In order to both prevent losses while also being careful not to have it dissuaded by mere temporary price movements, the investor would need to set a price that gives that balance.

Unfortunately, that is left solely to the discretion of the investor. There are no rules or basis to form guidance.

The Stop-Loss Price Might Not Be The Price The Shares Are Sold At: Prices in the stock market can change in seconds. As such, when a stop price is reached, it is possible that the locked-in price and the price that the shares would be sold for might differ.

This is because the moment the investor reaches his or her preferred stop price, the stop order becomes a market order and the price that it would be sold at might now be even lower than the stopped price.

In other words, an investor who wants to use stop –order as a risk mitigation tool needs to consider both sides of the table before choosing whether to make the jump or not.

#crypto2023 #pepe #bitcoin #ctsi #binance

According to CryptoSlate data, the Cartesi (CTSI) token recorded a 68.56% increase over the past seven days following the project’s update announcement published on April 11.

According to the Cartesi Ecosystem Update 2023, the  Cartesi Rollups are fast approaching the mainnet deployment stage.

The surge

The CTSI token was traded for around $0.1532 on April 11, when the update announcement was published. On April 20, the CTSI price increased as high as $0.3341 — marking a 118% increase in nine days.

CTSI price charted an upwards trajectory up until April 21. However, CryptoSlate data indicates that the token lost 10.86% of its value in the last 24 hours. Regardless of the fall, the current CTSI price reflects an 82% increase over the last 30 days.

Cartesi rollups

Cartesi is essentially a layer-2 scaling solution that allows developers to build dApps that operate across multiple chains. It supports Linux and other mainstream software components while allowing builders to deploy application-specific rollups as layer-2 on top of Ethereum (ETH) — or as layer-3 on other chains.

The announcement post explains the difference by stating:

“…Cartesi Rollups is an application-specific execution environment that can be deployed as layer 2 or layer 3; it’s not a layer 1 blockchain or DApp, which means that the traditional concept of a “mainnet launch” for Cartesi differs from many other blockchain projects. What will actually go to mainnet are DApps built using Cartesi.”

The mainnet launch is by deploying the first Cartesi-powered dApp Honeypot on the ETH mainnet. The Honeypot dApp is designed to hold real assets to both “setting a financial benchmark for secure asset management and providing a gamified battlefield for the community to help audit and test Cartesi’s cutting-edge technology.”

The announcement post states that launching the Honeypot to the mainnet will “mark the beginning of a new era” for Cartesi as it will test and fortify Cartesi’s tech and security. With that being said, the Cartesi team didn’t disclose a specific date for the Honeypot’s deployment.

#ctsi #crypto2023 #Binance #BullRun #eth2.0