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I want to know: let say
I purchase stock Name: [censored] on 1 dollar 100 shares on Monday and put stop loss on 0.90 cent it is Tuesday morning and a stock value is a 0.60 cent what will hapen with my share? who is going to buy my share? what about if a bid and ask price is a 0.60 for bid and 0.61 for ask... and I have stop loss on 0.90 who will purchase this share? Wall street? brokarage firm?
Thank you
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Rank: Advanced Member
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Joined: 9/28/2005(UTC)
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It will be filled automatically at the best price.
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Rank: Advanced Member
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ok, that mean if the bid is 0.60 cent and the ask is 0.61 it will fill with the ask price right? the best one is always a ask price? that what i thinking? I dont know exactly that why I ask, hmm.... so how to secure asset if a stop loss dont work? Let say stock will fell down 50% and I can't doing anything even a stop loss option will not help me? hmm... so why to use a stop loss? if you can sell on the lower price in next trading day in my example on 0.61 cent for share right? may be that litte confused but I dont understand how to prevent asset from big looses? I know that only trade with a big corporation, lot of volume, etc but sometime news change everythink and even a very good fundamental and techical analysis will not help in trading...
ok may be that is a little crazy question but I dont understand a psychology of human.... here is example : Stock [censored] is trading a 10 dollar a share and give news at 10:00 oclock and people sell share becuase of news , news was about cutting job stock fell down like -6-7% , another company grown because of cutting job possition... if you look for some archives of news share [censored] you may seen that news about 30,000 cut job ... was a good news... why? what factor, things, think influence that people buy or sell [censored] company?
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Rank: Advanced Member
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Joined: 9/28/2005(UTC)
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Location: Malaysia
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Hi, maybe you can learn a lot from this website. (Is it ok to post url links? Tell me to stop if it is not ok.)
http://www.michaelcovel.com
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Rank: Advanced Member
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Location: connecticut,USA
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http://www.michaelcovel.com I think that is a good web site but I would like to know your opinion, all people opinion about previous post , share your idea, comments, why you think that way, please resond accurance and open mind, honestly I would like to hear a respond from you guys, let learn together, share your idea will be good way to teach other about stock market, everyone begin from someplace... Nobody in the world just begin from proffesional position right?
Thank you to everyone for cooperate!!!
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Rank: Advanced Member
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Hey K-
I guess I never saw this thread with the move and all... you know how things always get lost when you move?!
Stop losses are no guarantee, but some insurance is better than none. In your hypothetical example, when the security started to fall you would be out once it fell below 0.90. Like 0.89. It would have to be some real bad news to drop 0.40 on a dollar stock with no incremental drops from the original dollar... perhaps, the company is filing bankruptcy.
A few thoughs here: 1) your broker might not even let you place a stop loss on a stock of that value; 2) liquidity has everything to do with getting out (or in); 3) assume that the market price will always result in slippage that goes against you (ask vs bid); 4) remember that for every trade there are buyers and sellers... someone is always betting opposite of you. In fact, this might mess you up in your hypothetical situation 'cause I'm not sure that you can sell short stocks worth a dollar. i.e., who's going to pick up the plummeting dollar stock?
Anyway, all good questions. There are many, many sources for these types of questions. A couple that I would recommend are 1) Trading 101 by Harris and Stock Investing for Dummies by Mladjenovic. I've read both and they're easy to understand.
Turtle- links are fine. :D
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Rank: Advanced Member
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Here is a classic example of a gap down... check out RFX!!!! Glad I wasn't riding that train!
:) M
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Rank: Advanced Member
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Joined: 6/6/2005(UTC)
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Location: connecticut,USA
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hey Marlyin right Refco have a gap down...it like a impossible to predict if a stock will have a gap down because of news...
On refco there are no buyer side... so people selling security and security go down as you see... if put a stop loss it may prevent "some capital" not all as you want in this situation but it is good to have stop loss! BTW dont trade securities with 2 milion volume..? you wasn't driving the train.... how you can drive this train... this train is a speedy one without brake and not stop...
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