Question about stops, limits, as well as advice.

**gambler2075** · 11-10-2010, 06:40 PM

Originally posted by MaxPowers View Post

I am with Zecco and had a question. If I have stock, and want to sell it when it goes down and hits a price, what is that called? What is it called when I sell it at a price that is up?
What is it called when I buy it at a certain price?
Zecco has limit price, stop, stop limit, and trailing stop.

Also I would like a little advice if you have it.

Also, what is a good website to read with information on stocks and stock picks?

(Zecco terms in parentheses)

1) A Stop loss (stop) is when you want to sell a stock at a price LOWER than the current price. Remember that that also depends on liquidity. A stop gets turned into a market sell when the price gets hit. In fast moving markets, there may not be bids large enough to absorb your selling when the stop gets triggered.

2) A (stop limit) is when you want a stop, but you are not willing to get filled LOWER than the stop price. If there were not enough bids at that price, your stop limit order would not be filled. I believe zecco will do partial fills on a stop limit (i.e. if you have a stop limit of 5, for 1000 shares, and the price falls from 5.01 to 5.00, but there are only 500 shares on the bid, then you would fill 500 shares. Then the price would go to 4.99 and the rest of your stop limit would not fill. Even if the price got to 4.00, you would still have your 500 shares left, waiting for a bid at 5.

3) A (limit price) can be either a buy or a sell. If the stock is at 5.01 in the above example, and you don't want to buy unless it hits 4.50, you would enter a limit buy at 4.50.

If you had shares and you wanted to sell at 5.50, and the price was 5.01, you would put in a limit sell at 5.50.

4) a (Trailing stop) can be either a percentage, or a dollar value. Some brokers let you do both. If the stock you own is at 5, and you have a 50c trailing stop, the stock can move from 5 to 4.75 to 4.51, and you would not execute. But if it hits 4.50 then it is executed as a sell. However, with your trailing stop, if the price moved first from 5 to 5.25, then your trailing stop would move to 4.75 (50c less than 5.25). Trailing stops are not moved lower. So essentially they allow you to have an automatically increasing stop loss order that may allow the stock to move in your direction while automatically raising your selling price.

g

**gambler2075** · 11-10-2010, 06:44 PM

Originally posted by MaxPowers View Post

Also, what is a good website to read with information on stocks and stock picks?

I am not a financial advisor, but I am a fairly successful trader (as of today I am looking at a 6 figure tax bill on just trading profits alone, for the second year in a row).

But I would say that trading is a very, very difficult road to take. That is if you want to be a successful trader

I always advise people not to get into trading as they will almost certainly lose whatever money they try to trade with, at least if they are going to try to daytrade with that money.

So maybe you can play speculatively with a small part of your portfolio, but be very careful out there.

Good luck.

g

p.s. as far as your specific stocks go, I have absolutely no idea, other than I think that the markets in general are quite overbought and I am being very hesitant with going long at this point.

p.p.s. Here's a better explanation...
Intro to Stock Trading

**MaxPowers** · 11-10-2010, 08:10 PM

Thanks for the info. I had forgotten the lingo because it has been over a year since I was doing this. I have done some research and understand some of the basics of the basics. I understand it is risky, and that is why I stopped doing it a while back. But I never went under. I actually am up 22% total, which is good for a start.
I make a good enough living, Army, and have lots of free time. Not looking at doing it professionally. yet. This is defiantly something I want to learn and get into eventually. I am not trying to jump into a get rich quick in the market thing. I just want to build on what I have, and slowly build my knowledge and experience. I know I will take losses, but I'm not throwing around stacks that I can't afford to loose.
Anyway, I would like to learn. I will read the link you posted and continue doing more research. And if there are any other books or resources you recommend, please let me know.
thank you

**gambler2075** · 11-10-2010, 08:55 PM

Nice job on the returns. I did send you a private message rather than spamming the forum.

Good luck!
g

**Scanner** · 11-11-2010, 05:14 AM

I always get confused on this too and every time I want to put in a Stop order, I have to call up Schwab and ask what I want, lol. I have a stop order sitting on my silver ETF right now. Not sure if they do trailing stops.

I would only amend one piece of advice from Gambler - not only could you speculate with a small part of your portfolio. . .I am convinced, at a certain point, you ought to speculate, that like chocolate and red wine in your diet, it's necessary.

Of course, you need some amount of money in there. . .how much is debatable. . .I would say at 40-50K would be the point you should take 2-4K and speculate.

But decide if you are an investor or a trader and act like one accordingly.

**jpg7n16** · 11-11-2010, 06:44 AM

Originally posted by MaxPowers View Post

Also, what is a good website to read with information on stocks and stock picks?

Warren Buffett MBA Talk

It's not a read - it's a video, but it's definitely worth your while. I listen to alot of his stuff on stock selection, and have a different view of stocks than Gambler does.

I'm more of an investor, Gambler is a trader. It's up to you to decide which you'd rather be. (Like Scanner is pointing out)

Question about stops, limits, as well as advice.