Mark Minervini's Official Blog

Stock Market Wizard, U.S. Investing Champion Mark Minervini Shares Ideas and Wisdom Here FREE!



Handling Stop-Loss “Slippage”

January 14, 2014



At the time you purchase a stock, the price at which you expect to sell at a loss should be written down and executed immediately upon the stock trading at that price.  It is at this critical point that you execute the trade as quickly as you possibly can.

 

Sooner or later however, one of your stocks will dive under your sell price before you can react; this is called “slippage”. My advice: get out immediately!  Take whatever the next bid price is.  Such a hard-falling stock is sending a warning.


One money manager I know badly mishandled this type of scenario. A stock dropped quickly on news and shot well below her pre-determined sell price; she was quickly down 15% on the position. She called me and asked my opinion. Of course, I told her I would have already sold if the stock had triggered my stop-loss. She instructed her portfolio manager to wait for the stock to come back and then to sell when they were down 5%. The stock never came back. In fact, it fell further and they ended up taking a 65% thrashing before they finally threw in the towel.

Does this sound familiar?

Sure, there are going to be many times when you sell a stock that’s down and it comes right back up. SO WHAT! Stop-loss protection is about protecting yourself from a major setback, or worse devastation; it’s an insurance policy. It has nothing to do with being right all the time or about getting the high or low price.
 

Success in the stock market has nothing to do with hope or luck. Winning stock traders have rules and a well thought out plan. Conversely, losers lack rules; and if they have rules, they don’t stick to them for very long; they deviate.

Remember, your first loss is your best loss

 

Mark Minervini

 

 

Master Trader Program SUPERPERFORMANCE WORKSHOP with Mark Minervini

 



Data and information is provided for informational purposes only. The information provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. Neither Mark Minervini, Minervini.com or Minervini Private Access , LLC nor any of its data or content providers shall be liable for any errors or omissions or for any actions taken in reliance thereon. By accessing this website, and its pages, links and trading services which users may access through this site, a user agrees not to redistribute the information found therein. All material in this website and its related websites and pages are protected under copyright laws of the United States. Unauthorized forwarding, copying or reproduction will be treated as a breach of copyright. Mark Minervini is not an investment advisor, financial planner, nor a securities broker. Minervini Private Access, LLC is not a registered broker-dealer. The Information provided in this website is not to be relied upon for your investment decision. Your decision to buy any securities is as a result your own free will and your own research. Individual performance depends upon each user or student's unique skills, time commitment, and effort. User's and students sharing their stories have not been compensated. Student stories have not been independently verified by Minervini Private Access, LLC. These results may not be typical and individual results will vary. Past results are not indicative of future returns. There is a very high degree of risk involved in any type of trading. Stocks, Options, ETF's & Futures are not suitable for all investors. Minervini Private Access, LLC., its subsidiaries and all "affiliated" individuals assume no responsibilities for your trading and investment results. No representation is being made that any account will or is likely to achieve profits. All investors should consult a qualified professional before trading any stock. Under no circumstances should anything contained in this website be construed or considered as an offer to sell, or a solicitation of any offer to buy. While all reasonable care has been taken to ensure that the information contained herein is not untrue or misleading at the time of publication, we make no representation as to its accuracy or completeness and it should not be relied upon as such. From time to time Minervini Private Access, LLC and any of its officers or employees may have a position or otherwise be interested in any transactions, in any investments (including derivatives) directly or indirectly the subject of this report. Entities including but not limited to Minervini Private Access, LLC, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Specific Entry Point Analysis®, SEPA®, Leadership Profile® and Minervini Select® are Registered Trademarks of Minervini Private Access, LLC. All other trademarks are property of their respective owners. All rights reserved.