ATFXWhat does floating stop loss mean? There is a risk of loss in investment

There are various ways to stop losses, and each person's stop loss method may be different, but the ultimate goal is to reduce their own losses. Therefore, when choosing a stop loss method, we can decide based on our own situation. So, what does a floating stop loss mean?

What does floating stop loss mean?

Stop loss: also known as tracking stop loss or following stop loss, after setting a stop loss price and floating stop loss, the stop loss price can be adjusted when the market is moving in a favorable direction for users, thereby locking in profits. The floating stop loss only takes effect when the market price changes in the direction judged by the user, and its reference price is the latest price when the stop loss and profit setting takes effect.

How to operate?

After each warehouse entry, the initial stop loss is very objective, based on technical analysis, but moving the loss to cost has a subjective color, after all, there is no technical analysis, this is based on psychological impact. In addition, moving to cost as soon as possible does not mean losing profits just after a few points have been made, otherwise it is mostly a matter of backtracking. As soon as possible but appropriately, when the market experiences a period of profitability or a small cycle returns, it is time to consider shifting losses.

The above is an introduction to the relevant content of stock floating stop loss, hoping to be helpful.